The cryptocurrency market started the week much like it concluded the previous one: with minimal changes observed in the last 24 hours as overall sentiment fell back into the “extreme fear” territory.
Bitcoin is currently valued at $89,900, recovering from a low of $88,000 seen on Sunday, but still displaying weakness after peaking at $94,300 following last week’s 25 basis-point interest rate cut from the Federal Reserve.
Volatility in the altcoin sector is also diminishing, with several tokens including ether and both experiencing slight gains of under 2% in the last 24 hours, while more than half of the top 100 tokens have declined in value during this time.
The CoinDesk 20 (CD20) Index has shown a 0.16% increase on Monday, while the broader CoinDesk 80 (CD80) Index has dropped by 0.77%, highlighting the struggles of smaller, riskier altcoins.
Derivatives positioning
- DOGE, HYPE, SOL, and ETH have experienced an uptick in notional open interest (OI) over the past 24 hours, while ZEC, BNB, AAVE, TRX, and various smaller coins have seen capital outflows. OI for BTC remains mostly stable.
- For DOGE futures, OI has climbed to 10.80 billion DOGE, the highest since November 20, supported by moderately positive funding rates. This combination indicates bullish positioning.
- With XRP threatening to drop below the long-standing $2 support level, OI has surged by over 3%, with funding rates remaining close to neutral. A breakdown could entice bearish traders to initiate short positions, potentially pushing funding rates into negative territory.
- In terms of funding rates, XLM, MNT, and HBAR are exhibiting negative figures, suggesting a predominance of short positions.
- On Deribit, the BTC put skew has moderated at the front end, whereas for ETH, front-end puts are trading at a premium compared to BTC, suggesting a net bearish outlook on the ETH/BTC pair.
- Block flows have included BTC calendar spreads and ETH put spreads.
Token talk
- The altcoin market has lagged behind bitcoin, ether and declining over the past 24 hours, with numerous tokens such as AERO, TAO, ZEC, and SKY dropping by as much as 4.5%.
- Conversely, one segment that has outperformed, or at least fared better than its counterparts, is the category of liquid staking tokens: Lido (LDO) and both experiencing gains of around 2%.
- The rise in ETHFI can be linked to a recent announcement about offering 10% in ETH cashback for users of the ether.fi card in a promotion dubbed “Ethmas.”
- According to CoinMarketCap’s “altcoin season” metric, the index sits at 19/100, a slight improvement over last week’s low of 16/100, but well below the high of 78/100 seen in September.
- This indicates that investors are still gravitating towards the stability and relative predictability of bitcoin and other larger market capitalizations rather than more speculative assets linked to volatility.
- Data from CoinGlass highlights that bitcoin’s market dominance has gradually increased, from 56.8% in September to 58.4%. This trend has coincided with the launch of thousands of new tokens, which historically has redistributed market share away from BTC.
