Our weekly crypto derivatives analytics report delves into macro events, the current state of crypto and trading signals from spot trading volume, and futures, options and perpetual contracts.

BTC has finally surpassed the $100K mark, leading to increased bullish positioning in derivatives markets. This reflects strong sentiment and a desire for upside exposure in perpetual swaps and futures. Short-term implied volatility has risen as traders seek options to capitalize on the rally.

Please check out the report’s highlights.

BTC's successful breach of the $100K barrier has led to a noticeable return of perpetual swap markets to all-time high open interest levels, although the response has been somewhat muted. Earlier in the week, perpetual swap markets shifted their focus to ETH after BTC's repeated failures to break through $100K. While funding rates for both derivatives remained high and positive, open interest in ETH contracts increased at the expense of BTC positions prior to the breakthrough. Additionally, ETH trade volumes have constituted a larger-than-usual market share.

BTC Calls See No Significant Influx Post-$100K

The sudden rise in spot prices has triggered a sharp increase in demand for short-tenor options, as traders seek exposure to the upward movement. BTC's term structure inversion has driven short-tenor implied volatility levels above realized volatility. Although implied volatility for BTC is lower than that of ETH, open interest data shows that the influx of call option open interest in BTC markets wasn’t as significant as for ETH. Nevertheless, BTC's volatility skew remains strongly bullish.

ETH's options market showed the most bullish positioning ahead of the overnight spot move, while the perpetual swap markets for both major cryptocurrencies reflected strong positive sentiment. Open interest is heavily weighted toward OTM calls, signaling a robust preference for upside exposure as realized volatility starts to catch up to implied volatility. This demand for upside exposure is evident for both tokens, particularly with ETH's remarkable increase in call option open interest over the past 24 hours.

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Bybit X Block Scholes Crypto Derivatives Analytics Report (Dec 5, 2024): After BTC Turns $100K, Investors Are Still More Bullish on ETH

The cryptocurrency market is experiencing unprecedented growth, particularly in major assets like XRP, Cardano (ADA) and Stellar (XLM).

The cryptocurrency market is experiencing unprecedented growth, particularly in major assets like XRP, Cardano (ADA) and Stellar (XLM), whose tokens have seen substantial price increases (XRP up 444%, ADA 280% and XLM 512%). This surge is being driven largely by aggressive accumulation from whale investors, as well as cautious but optimistic sentiment in the crypto community. 

Meanwhile, interest in meme coins is declining as investors shift focus to more sustainable projects. The integration of AI in blockchain ecosystems and the emergence of hyperliquid token generation events (TGEs) are also reshaping market dynamics, indicating a transformative phase for cryptocurrencies.

Significant Growth in Major Cryptocurrencies

The report highlights impressive price increases for several major cryptocurrencies:

Despite these gains, general sentiment in the crypto community remains cautiously optimistic.

 activity is a key factor in current crypto market dynamics:

Since mid-October, there’s been considerable accumulation of Bitcoin by whale wallets, which have added a total of 91,856 BTC. This accumulation has played a substantial role in driving up BTC’s price.

In contrast, there’s been a decline in stablecoin holdings among these wallets, suggesting a strategic shift toward investing in cryptocurrencies, rather than choosing to hold stable assets.

The following several emerging trends are reshaping the cryptocurrency landscape.

Overall, our report underscores a transformative period in the cryptocurrency market, characterized by significant asset growth, strategic whale behavior and the integration of advanced technologies.

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Whales Accumulate Bitcoin as It Reached $100K; Emergence of AI Agent

Our monthly option volatility report delves into insights from options volatility to inspire your next crypto move.

Option volatility outlines a compelling narrative for Bitcoin as it approaches the $100K milestone. Leading up to the U.S. election on Nov 5, 2024, Bitcoin's implied volatility experienced a dramatic surge, with short-term implied volatility rising approximately 25 percentage points above post-election expirations. This spike indicated strong bullish positioning in the derivatives market as traders sought to capitalize on anticipated price movements driven by electoral outcomes.

In the immediate aftermath of the election, there was a sharp decline in short-term volatility, aligning with a rally in spot prices that, in turn, led to higher realized volatility. However, the decline in implied volatility didn’t reflect a long-term bearish sentiment — instead, it suggested a temporary easing of uncertainty regarding the election results. The term structure of implied volatility demonstrates a complex relationship: while short-term volatility dipped, longer-dated options remained stable above 50%.

The call/put skew indicates strong demand for bullish call options relative to bearish puts since the election, reflecting heightened upside exposure during BTC and ETH rallies. However, when BTC retraced to $91.3K, the skew shifted 6% toward puts, signaling bearish sentiment. This was inconsistent with futures markets, in which prices remained above spot levels, indicating ongoing bullishness. The skew toward OTM puts arose from increased demand for protective hedges, rather than from a lack of call interest. Ultimately, this suggests traders believe any sell-off would be temporary, supporting the idea that volatility is necessary in order for BTC to reach the $100K mark.

In contrast to Bitcoin, Ethereum (ETH) has emerged as a more consistently bullish asset in recent weeks. While both BTC and ETH exhibited similar volatility patterns immediately following the election, Ether has shown notable resilience and increased momentum, particularly in the wake of Gary Gensler's resignation. This political shift has positively influenced ETH’s market dynamics, resulting in a stronger demand for ETH options.

Ether outperformed Bitcoin during critical market events, including both the election and ETF announcements in 2024. Following Gensler's resignation, ETH gained significant traction, with traders increasingly focusing on Ethereum as a more attractive investment. This shift is evident in the significant drops in the ratio of BTC-to-ETH spot price, indicating that traders are reallocating their preferences toward ETH.

The divergence in implied volatility between BTC and ETH options further underscores this trend, as the ratio of implied volatility for ETH options has surpassed that of BTC, reflecting a stronger demand for ETH optionality. Historically, ETH has exhibited higher volatility compared to Bitcoin. This recent uptick in ETH's implied volatility reestablishes the typical pattern of ETH commanding a premium in the options market.

Moreover, the skew in options pricing has shifted in favor of calls for both BTC and ETH, but ETH's skew has remained more robust. This suggests a stronger bullish sentiment for ETH, as traders are positioning more aggressively for its price appreciation compared to that of Bitcoin. As the market continues to evolve, Ethereum's increasing dominance and the bullish signals from its options market position it as a leading contender in the cryptocurrency landscape, making it likely to outperform Bitcoin in the near future.

Bybit X Block Scholes Option Volatility Report: November Option Volatility Report: Volatility on the Road to $100K

Thruster (THRUST) is a cutting-edge DEX on the Blast Layer 2 blockchain, offering both standard and concentrated liquidity AMM pools. 

 chains has plenty of solutions offering minuscule fees, excellent scalability and nearly instant transactions. Seemingly countless sidechains, rollups and other types of Layer 2 networks servicing the Ethereum blockchain have been launched in recent years. However, many, if not most, of these chains struggle to offer anything beyond low fees and fast transaction processing capacity. While these benefits are nothing short of remarkable — especially considering Ethereum's never-ending network congestion issues — the innovation in this area needs to move beyond another platform offering the same cost and speed advantages.

 (BLAST) Layer 2 blockchain in early 2024 was a refreshing change — finally, an Ethereum Layer 2 solution that provides something more than just cost and speed efficiencies. Blast is known as a unique Layer 2 chain that offers native yields for ETH and 

, a feature that has attracted significant capital and 

 (DeFi) actors to the platform. Leveraging Blast's unique capabilities and popularity in DeFi, the Thruster Finance 

 (DEX) was launched on Blast’s blockchain in March 2024.

Thruster offers both the tried-and-tested 

 (AMM) model and a more advanced AMM model derived from the 

 (UNI) v3–inspired concentrated liquidity provision. Despite offering sophisticated options for token swaps and liquidity provision, Thruster aims to be as beginner-friendly as possible for traders, 

 (LPs) and developers. It has also tightly integrated Blast's own loyalty programs — Blast Gold and Blast Points.

 (THRUST) is a DEX on the Blast Layer 2 chain that provides standard AMM and concentrated liquidity AMM services to power its token swap and liquidity provision operations

.Thruster was launched in March 2024, soon after the introduction of Blast's mainnet, and builds upon the Layer 2 blockchain's popularity in the DeFi community, its capital efficiency and its cost and speed advantages.

Debuting in February 2024, Blast became a major Layer 2 market disruptor by introducing native yield benefits for holders of Ether and stablecoins. Simply by bridging your ETH or stablecoin funds to Blast, you can earn competitive yields from these assets as an added benefit to the cost and speed efficiencies that Blast boasts as an 

 solution. The native yield functionality quickly attracted DeFi users to the platform, a development that Thruster Finance has successfully capitalized on since the early days of its operation.

Thruster Finance consists of three key parts: the token swap section, the Uniswap v2–inspired constant factor AMM and the concentrated liquidity AMM, which adopts the basic characteristics of Uniswap v3.

Thruster quickly became the largest DEX on Blast by offering user-friendly and highly flexible token swap and liquidity provision options for its AMM and concentrated liquidity AMM components. At the height of its dominance on the chain, in June 2024, Thruster boasted a 

 (TVL) of close to $600 million. Although the protocol is currently off these highs, it still ranks as the largest DEX on the Blast blockchain, with a current TVL of 

The Thruster Finance project’s seed-stage startup is based in California. It was founded in 2023 by a pseudonymous team that has reportedly contributed to several top-50 protocols. In April 2024, Thruster attracted media attention when it 

 from several well-known institutional and individual crypto investors, including Pantera Capital and OKX Ventures.

Thruster supports token swaps for ETH, Blast's native cryptocurrency; BLAST, the blockchain's own stablecoin; USDB; and a range of tokens within the Blast ecosystem. Like other AMM-based exchanges, users trade against liquidity pools funded by LPs earning fees from transactions in each respective pool.

The platform features an analytics section that provides up-to-date, transparent information on the current swap rates, fees involved, 

There's also a portfolio section that helps traders track their investments and operations across pools and provides information on users' balances, earnings, staking and liquidity pool commitments.

For LPs, the platform offers two varieties of swap pools: the standard constant factor AMM and the concentrated liquidity AMM. We'll discuss these two kinds of pools in the section below.

Thruster also offers income opportunities via staking. Users who stake the platform's native crypto, THRUST, are issued veTHRUST tokens, which entitle them to earn revenues from the protocol's operations and other protocol benefits.

Although Thruster Finance offers fairly sophisticated products, it aims to appeal to all kinds of DeFi users, from rank beginners to seasoned pros. To meet this goal, the platform offers two user interface modes: lite and pro.

The lite mode is suitable for newbies and less experienced users. It features user-friendly token charts, critical token and pool information and social integrations. Meanwhile, pro mode is designed for experienced DeFi users and provides additional tools for order management, leverage use and asset discovery.

One variety of swap pools on Thruster is based on the constant factor AMM model. This is a standard AMM system, first introduced by Uniswap v1 and improved upon in Uniswap v2. In a constant factor AMM, a swap pool is based on a simple formula, 

 represent the quantities of two tokens in the pool and 

 is a constant that remains the same regardless of

. LPs provide liquidity at any price point for the swap pair, irrespective of how the swap rate moves.

The constant factor AMM model provides numerous advantages, including simplicity and relatively high predictability of yields for LPs.

Thruster, however, has made some modifications to the original constant factor AMM developed by Uniswap. First of all, the platform has implemented different fee tiers for swap pools. With Uniswap v2, all swaps are charged one fixed fee — 0.3% per transaction. However, using the same rate, without taking into account liquidity and activity levels for a particular pool, isn't the most flexible solution. This structure limits the flexibility of incentives for LPs — the primary recipients of revenues from swap fees. This is why Thruster has implemented a tiered fee system, as the differential fee model is designed to encourage more active and targeted liquidity provision and token trade.

Another unique feature of Thruster's constant factor AMM is the direct integration of Blast's reward systems, Blast Points and Blast Gold. In addition to transaction fee revenues, LPs may qualify for points under these loyalty programs.

Thruster also offers a more advanced variety of crypto trading and liquidity provision based on the concentrated liquidity AMM model. This is the AMM variation first introduced in Uniswap v3. 

In a concentrated liquidity AMM, LPs can provide liquidity within specific price ranges within a pool. The advantages of concentrated liquidity over the standard constant factor model are numerous, such as greater capital efficiency, potentially higher yields and reduced 

 rates. This type of AMM provides greater flexibility to LPs in terms of their capital allocation.

LPs contributing funds to Thruster's concentrated liquidity AMM pools are also rewarded with Blast Points and Blast Gold in addition to revenues from swap fees.

 is a blockchain explorer tool for the Blast ecosystem. In terms of functionality and design, it’s quite similar to Ethereum's 

. Blastscan lets you view detailed statistics on tokens and 

 addresses hosted on Blast’s Layer 2 platform. While Blastscan covers the entire blockchain's ecosystem and isn't specifically a part of Thruster Finance, it can be used by LPs to withdraw liquidity from Thruster's swap pools.

LPs can add liquidity only via the Thruster user interface, but they can use either the interface or Blastscan when removing previously added liquidity. The latter method isn't as user-friendly as the former option, but it might suit more technically minded users accustomed to the active use of Blastscan.

One distinct feature of Thruster is the abundance of additional incentives for users on top of the standard income from transaction fees. Rewards offered on Thruster include Blast Gold, Blast Points and Thruster Credits. Notably, these rewards aren't restricted to LPs, as other platform participants, such as token traders and referrers, can also expect to receive some of these reward types.

Blast Points are rewards that qualify you for BLAST token airdrops. The Blast project distributes these points to eligible individual wallets and smart contract addresses that hold balances of either of three assets — ETH, 

 stablecoin. Thruster Finance has integrated the distribution of these points to specific liquidity pools. The points are allocated to eligible LPs contributing to these pools.

Blast Gold represents rewards paid out by the Blast Layer 2 project to 

 (DApps) that actively contribute to the development of the blockchain's ecosystem. Essentially, Blast Gold is a bonus reward (on top of Blast Points) that Blast distributes to select DApps on its network. Thruster Finance is one of the recipients of Blast Gold. A recipient DApp project can internalize its Blast Gold rewards, or share them with their own user community.

Thruster has decided to share its Blast Gold rewards with its two main user community groups: LPs and token swappers. For the latter group, swaps involving ETH or USDB are eligible for Blast Gold rewards.

On top of the rewards provided by Blast, Thruster has designed its own loyalty program, Thruster Credits. These credits are awarded to LPs, token swappers, active participants in social media campaigns run by Thruster and those referring new users to the platform. Thruster Credits qualify you for the ongoing THRUST token airdrop, designed to distribute 7% of the token's supply to various groups of eligible users.

THRUST is Thruster Finance’s native cryptocurrency. Launched on Oct 9, 2024, it's an 

 asset issued on the Blast chain. When you stake THRUST on Thruster Finance, you’re issued Vote Escrowed Thrust (veTHRUST), an asset that qualifies you for a range of benefits, including a share of revenues from protocol fees, additional bonuses for liquidity provision, rewards from participation in on-chain voting and the 

 on key features and the future direction of the protocol.

THRUST is a supply-capped asset, with a total and maximum supply of 500 million. As noted earlier, 7% (or 35 million) of the token's supply is slated for distribution via an airdrop to several eligible user groups. These include eligible LPs, token traders and recipients of Thruster's reward program points, including Thruster Credits. The airdrop started on the day of THRUST's token generation event (TGE) in early October 2024, and is scheduled to last 90 days, until Jan 9, 2025.

The THRUST token's overall supply allocation shares are per the chart below:

You can buy the THRUST token on Bybit's Spot market as a 

. You can also take advantage of Bybit's 

 campaign to earn a share of the total 2 million THRUST prize pool. To qualify for a 200 THRUST reward, new users need to either deposit at least 500 THRUST, or deposit at least 100 USDT and trade 100 USDT worth of THRUST via their first Spot trade. Meanwhile, existing Bybit account holders can also earn a reward of up to 1,000 THRUST by trading at least 500 USDT worth of THRUST on the Spot market. The campaign runs through Dec 10, 2024, 8:59PM UTC.

Automated market makers (AMMs) have experienced rapid growth ever since the introduction of the concept by Uniswap in 2018. The concentrated liquidity model, again championed by the Uniswap DEX, has added further options and versatility for LPs. However, inflexible fee structures and poor user interfaces have dogged the broader adoption of both liquidity provision and token swaps on AMMs for years. 

Thruster Finance is a timely addition to the AMM DEX landscape, with advantages like a beginner-friendly interface, different fee tiers based on the specifics of each pool, and an array of additional rewards — Blast Gold and Blast Points, as well as app-specific credits.

Thruster offers a comprehensive suite of options for DeFi veterans, as well as for those new to AMM-based liquidity provision or token trade. All that Thruster needs now is wider recognition and adoption by the DeFi user community — never an easy job in a competitive field where the likes of Uniswap, 

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Thruster (THRUST): An Advanced AMM for the Blast Ecosystem

Bybit 360

Options

Trading

Data shows that derivatives traders on Bybit have been setting up for short-term market volatility, while things could be relatively stable toward year-end.

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 hit a fresh all-time high as traders and investors braced for the outcome of the U.S. elections and the upcoming interest rate decision from the Fed. As our 

 highlighted, the rising odds for a Republican presidency have increased volatility in Treasuries and equities, suggesting significant market implications depending upon election outcomes. Data shows that derivatives traders on Bybit have been setting up for short-term market volatility, while things could be relatively stable toward year-end.

 derivatives traders have been focusing on the upcoming macro events, and the U.S. elections are front and center, dominating news headlines globally. Despite the price of BTC remaining in its multi-month range, data shows that traders have been keen to bet on BTC's potential price movement after the U.S. elections. 

 page indicates that most of the open interest in BTC options was has been on contracts with a Nov 8, 2024 expiration.

Figure 1: Open interest by expiration of BTC options on Bybit. Source: Bybit

Figure 2: Open interest by strike of BTC call options with Nov 8, 2024 expiration on Bybit. Source: Bybit

Among the calls, the $75,000 strike price seems the most popular choice, while $73,000 and $71,000 have also seen notable open interest. This could mean that some traders are betting on the price of BTC soaring above $70,000 or potentially hitting $73,000 right after the U.S. elections.

The picture seems clearer when looking at the puts. With the same expirations, most of the open interest has focused on puts with a $68,000 strike, and puts with a $62,000 strike have also received plenty of attention.

So, how can we interpret this overall? At the time of this writing (Nov 5, 2024), BTC has been trading around $68,700 on Bybit. Calls at a $73,000 strike with a Nov 8, 2024 expiration may be considered aggressive, while $68,000 puts with the same expiration could be considered reasonable downside protection for the election trade. 

Figure 3: Open interest by strike of BTC put options on Bybit. Source: Bybit

It's worth noting that the implied volatility (vols) of short-dated BTC options has been rising rapidly to over 89% (even realized vols went over 40%), which many consider relatively high. Vols is one of the key components when it comes to pricing options contracts. In a nutshell, the higher the vols, the higher the price of the options contracts, and vice versa. Since the vols of short-dated BTC options have surged to a relatively high level, traders may need to pay a premium if they want to use these options contracts to speculate on BTC prices, which may limit the upside.

Figure 4: Implied volatility of BTC options with Nov 8, 2024 and Nov 29, 2024 expirations on Bybit. Source: Bybit

Figure 5: Historical volatility of BTC options on Bybit. Source: Bybit

BTC options trading data on Bybit shows that most open interest on BTC calls with a Nov 29, 2024 expiration has been at a strike price of $75,000 (see Figure 6, below). It seems traders aren’t expecting an imminent bull run by the end of the month. However, since the market is filled with uncertainties, market participants could change their setups anytime.

Figure 6: Open interest by strike of BTC call options with Nov 29, 2024 expiration on Bybit. Source: Bybit

Short-term volatility is almost inevitable in the crypto market amid a series of macro events. Traders are expected to actively make trades shortly after the U.S. presidential election results are confirmed. Also, the market could reassert the pacing of the rate-cut cycle from the Fed’s interest rate decision and the press conference afterward. All these events could cause volatility in the crypto market, especially for BTC. That's why trading derivatives can offer leverage and, at the same time, downside protection — and that's exactly what traders need during a volatile market. Follow Bybit 360 and Bybit Options for more insights.

Disclaimer: Investing in cryptocurrencies and their derivatives involves substantial risk of loss, and isn’t suitable for every investor. This article provides facts for educational purposes only, and does not represent any financial advice. Prior to making any investment decisions, please ensure you fully understand the risks involved and seek independent advice if necessary. Our customer support team is available to assist you with any inquiries.

Learn From Smart Money: BTC Reaches a Fresh ATH Amid Macro Events, but What’s Next?

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