Mar 24, 2025: Our weekly Institutional Insights explores the latest market developments — market performance, industry news, exchange-traded fund (ETF) flows, trending topics, upcoming events and token unlocks — to help you supercharge your crypto trading.

 explores the latest market developments — market performance, industry news, exchange-traded fund (ETF) flows, trending topics, upcoming events and token unlocks — to help you supercharge your crypto trading.

Weekly highlight — retail buying continues

In a turbulent stock market facing trade issues and economic slowdown fears, retail investors are undeterred, increasing their investments despite mounting losses.

In the week ending Mar 19, 2025, individual traders invested over $12 billion into US equities, significantly above their 12-month average, according to JPMorgan Chase. This aggressive buying suggests that stocks may not have hit bottom yet, as retail investors typically hold on longer during downturns.

This behavior mirrors previous down years, such as 2022, when the equity benchmark fell 19%. Currently, retail investors are facing a 7% loss for the year, while the S&P 500 has dropped 3.7%.

Despite a sharp market sell-off in late February 2025, retail buyers remained active, contrasting with institutional investors who exited US stocks quickly. A recent Bank of America report showed significant stock inflows from both institutional and private clients, totaling $43.4 billion this year.

However, Wall Street sentiment is increasingly bearish, with several major firms downgrading their expectations for US equities. Individual investor sentiment has also weakened, with bullish views dropping below 20% for three consecutive weeks.

Disconnection between investor sentiment and actions is evident, highlighting that retail investors are continuing to invest despite prevailing bearish attitudes.

Weekly crypto highlight — Stablecoin bill on track for approval

A key US House committee is set to advance significant 

 legislation, a priority for President Donald Trump and the crypto industry. The House Financial Services Committee panel will review the bill on April 2, driven by bipartisan support from figures like New York Senator Kirsten Gillibrand and increased campaign funding for pro-crypto candidates.

Committee Chairman French Hill emphasized that a regulated stablecoin market could enhance the US dollar's dominance, modernize payments and improve financial access without government overreach. Crypto firms are advocating for stablecoins as a means to provide affordable and faster financial services globally.

Dollar-backed stablecoins are designed to bolster demand for US dollars, and are typically supported by highly liquid assets. However, critics, including Congresswoman Maxine Waters and Senator Elizabeth Warren, argue the legislation lacks consumer protections. They seek to ban tech companies like X and Meta from issuing stablecoins, and highlight concerns over the absence of safeguards such as FDIC insurance, as well as potential risks to deposit levels and credit access.

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Weekly Institutional Insights: Retail buying continues; Stablecoin bill might pass

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.

Global asset prices stabilized this week, with cryptocurrencies maintaining a strong correlation to US equities during the recovery. BTC is trading above $85K, and ETH has regained the $2K mark. Despite this, derivatives market activity remains low, with negative funding rates for major tokens like BTC, ETH and SOL. Demand for short-dated options, which had surged for downside protection, has decreased as realized volatility has subsided.

Please check out the report’s highlights.

Short-term protection falls as the market calms

A quieter spot market corresponds with a calmer options market. While lower realized volatility hasn't restored BTC's term structure of at-the-money implied volatility to an upward slope (as it has for ETH), short-dated volatility has decreased. The recent pause in a month-long sell-off has stabilized option markets and sharply reduced demand for short-dated protective puts.

Lower realized volatility in ETH’s spot price has reversed the at-the-money implied volatility term structure, leading to reduced volatility expectations. However, options activity remains significantly lower than at the end of February 2025, with modest open interest in longer-dated contracts and the rollover of expired weekly options. Demand for call options is exceeding that for puts, as ETH's spot price has rallied to the key $2K level.

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Bybit X Block Scholes crypto derivatives analytics report (Mar 21, 2025): Short-term protection subsidies as sentiment reverses

PayFi bridges traditional payments with blockchain technology to enable instant settlements, reduce transaction costs and tokenize future cash flows and assets for liquidity.

The world’s financial infrastructure remains plagued by high transaction fees, lengthy settlement times and limited accessibility, leaving billions of people excluded from essential financial services. 

 has shown promise in addressing these issues, but adoption challenges persist in bridging the gap between traditional finance and decentralized solutions.

This article explores how Payment Finance (PayFi) creates smarter payment solutions through DeFi integration. We'll examine what PayFi is, how it works, its advantages and disadvantages, how it compares to traditional systems, its real-world applications and its future potential in transforming global finance.

Payment Finance is a breakthrough financial model that bridges traditional payments with blockchain technology in order to enable instant settlements, reduce transaction costs and tokenize future cash flows and assets for immediate liquidity.

Championed by Solana Foundation's President Lily Liu, PayFi harnesses the 

 principle by allowing assets and future revenues to be tokenized and instantly monetized. The result is a financial ecosystem in which capital flows more efficiently, and users can access the value of tomorrow's assets today.

PayFi’s streamlined architecture combines blockchain infrastructure, 

 and tokenization to revolutionize payment processes. 

Fundamentally, PayFi runs on high-performance blockchains like 

 (SOL), providing 400 ms transaction finality and processing thousands of 

 (TPS) at minimal cost. This infrastructure ensures nearly instantaneous settlement as compared to traditional systems' multi-day processes. For example, RippleNet uses the XRP Ledger (XRPL) to conduct global money transfers with almost instant finality at near-zero fees, as opposed to SWIFT transactions that may take days to settle and cost between $15 and $75.

Smart contracts form PayFi's operational core, automatically executing financial instructions when predefined conditions are met. These self-executing agreements eliminate intermediaries, enabling complex financial operations to proceed without manual intervention.

 with blockchain capabilities by creating digital representations of invoices, future earnings and physical goods. These tokens interact with 

 (DeFi) protocols, unlocking new liquidity opportunities and enabling innovative financing models — such as, "Buy Now, Pay Never," whereby yield generated from deposits covers payment costs without touching principal.

PayFi effects transformative benefits alongside important challenges that impact its adoption and implementation.

PayFi vs. other traditional payment systems

Traditional payment infrastructure operates through a complex web of intermediaries — banks, processors, clearinghouses and correspondent networks — each of them extracting fees while adding settlement delays. This multi-layered system creates 2–3% merchant fees and 3–5 day settlement periods, and excludes the 1.4 billion adults globally who have no banking access.

PayFi fundamentally reimagines this architecture by leveraging blockchain's 

. By removing intermediaries and enabling 

 value transfer, PayFi dramatically reduces costs while allowing near-instant settlement across borders. This structural shift creates unprecedented efficiency and accessibility — regardless of banking status.

PayFi unlocks financial capabilities that are impossible in traditional systems. Its programmable nature enables automatic conditional payments, revenue-sharing and complex financial arrangements without human intervention. Meanwhile, pre-funding requirements that burden cross-border commerce are eliminated through real-time settlement mechanisms.

Perhaps most revolutionary is PayFi's potential for financial inclusion: while traditional systems require extensive documentation, credit histories and bank accounts, PayFi requires only internet access, transforming financial services from an exclusive privilege to a universal utility.

PayFi's applications span diverse financial sectors, revolutionizing everything from consumer payments to global trade finance via blockchain-based solutions.

Unlike traditional financing that requires eventual principal repayment, this innovative model allows users to deposit funds into yield-generating protocols and use only the interest to cover purchases, leaving the principal untouched. Users can maintain their capital while letting the generated yields pay for goods and services.

Businesses can tokenize their invoices or future revenue streams and instantly access liquidity through decentralized marketplaces. This alleviates cash flow constraints without the extensive paperwork and delays of traditional factoring, helping companies maintain operations while waiting for customer payments.

Content creators can receive advance funding based on projected earnings, or tokenize future revenue streams. Accessing capital immediately rather than waiting for platform payouts that typically take weeks or months allows creators to maintain continual content production without financial interruptions. 

By leveraging stablecoins and blockchain's borderless nature, individuals can send money globally in seconds — with fees often less than 1%, compared to traditional remittance services' 6%–7% average cost. This dramatically reduces costs while increasing the speed of international transfers.

Suppliers can receive immediate payment for goods through tokenized purchase orders or invoices, while buyers maintain their standard payment terms. The resulting win-win arrangement improves liquidity throughout the supply chain — particularly benefiting smaller suppliers who often struggle with delayed payments. 

Traditionally paper-heavy and inefficient, trade finance is being streamlined by PayFi platforms that tokenize letters of credit and other trade documents. Digitizing these instruments reduces processing times from weeks to hours while enhancing security through cryptographic verification.

The future of PayFi holds tremendous potential as blockchain technology continues to mature and gain mainstream acceptance. Key developments we can expect include the following:

As PayFi matures, its integration with traditional finance, its technological improvements and growing institutional adoption will likely transform it from an emerging concept into a fundamental component of the global financial infrastructure.

Payment Finance (PayFi) combines blockchain efficiency with traditional finance, enabling instant settlements, reduced fees and novel financing models. Though adoption and regulatory challenges persist, PayFi's ability to unlock liquidity, drive financial inclusion and reshape transactions positions it as a pivotal innovation in global finance.

Intermediate

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Payment Finance (PayFi): Smarter payments in a DeFi world

Check out the best crypto credit and debit cards you should apply for today!

In the early days of crypto, holders generally used currencies like 

 (P2P) transactions. Now, crypto debit and credit cards make it much easier to convert cryptocurrencies into fiat to use for payment. Whether you’re new to crypto or a long-time investor, a crypto card can help you access and use your digital holdings.

This article lays out the best crypto credit and debit cards currently available to consumers. It also explains how you can decide which is the best card for you.

A crypto credit card allows you to earn cryptocurrency as a reward for spending, while a crypto debit card converts cryptocurrency into fiat when you make a purchase or use an ATM.

As with regular credit cards, using crypto credit cards involves borrowing money from the issuer. When you make a purchase, the card company provides the funds necessary and your balance increases. As with regular cards, crypto credit cards allow holders to earn rewards for their purchases. What sets crypto credit cards apart is that the rewards come in the form of cryptocurrency that the issuer purchases for the holder.

One major benefit of using a crypto credit card is that it gives you a risk-free way to earn cryptocurrency just by making everyday purchases. This makes it a great option for hesitant, risk-averse newcomers to the world of crypto. The only significant drawback is the volatility of crypto markets, but at least cardholders will only be risking their rewards, rather than larger savings.

A crypto debit card is similar to a regular debit card in that the holder uses their own money to make purchases or withdraw cash from an ATM. Unlike regular debit cards, most crypto debit cards draw from the holder’s cryptocurrency accounts. This makes them a convenient way to convert cryptocurrency into fiat that you can use to make standard purchases. Other crypto debit cards allow you to preload 

In addition to converting crypto into fiat, crypto debit cards often allow you to reduce foreign transaction fees and easily spend money in multiple currencies. Potential pitfalls include geographical restrictions and the triggering of taxable events for using cryptocurrency.

How to choose the best crypto credit and debit cards

While there still aren’t as many crypto cards available as conventional credit and debit cards, new options are appearing every year. As the number of choices increases, consumers need to put more thought into their decisions. There are a few key factors for you to consider before choosing a card.

First of all, think about the type of cryptocurrency you’ll be using. Some crypto credit cards only let you earn rewards in a particular cryptocurrency, and some crypto debit cards can only connect with certain cryptocurrency accounts. If you’re new to the world of crypto, and you don’t care which currency you end up using, this shouldn't be an issue. If, on the other hand, you already have a currency of choice, you’ll need to find a card that allows you to use it.

When comparing the best crypto credit cards, you’ll want to weigh the rewards that each card offers. In general, a higher reward rate will allow you to earn more cryptocurrency. Some cards offer a flat rate for all types of purchases, while others offer higher rates for buying products and services that fall within certain categories. If you happen to spend a lot of money on a particular area of goods or services, you may want to look for a card that will reward you for your habits.

While the best crypto credit cards are generally affordable, there are certain fees for you to consider. Some cards charge an annual fee, while others are completely free. Foreign transaction fees are common, but you can find cards without them, which is an especially good idea if you travel abroad. Also, look out for cryptocurrency sales fees, which are pesky charges that show up every time you sell the rewards you’ve earned in crypto.

For many users, the main point of owning a crypto credit or debit card is to optimize crypto-to-fiat conversions. Your Bitcoin debit card will hardly prove useful if it doesn’t allow you to quickly and easily convert crypto into fiat. Unfortunately, some issuers use experimental methods that confuse cardholders and complicate conversions. By avoiding these types of issuers, you can ensure you get a card that truly serves your crypto needs.

A crypto card is only beneficial if you can actually use it. The world of crypto is evolving rapidly, and every month seems to bring a new set of regulations. Amid this dynamic environment, you need a card that’s currently usable in your preferred location. That way, you can make sure you maintain constant access to your digital assets.

As cryptocurrencies gain popularity, the number of crypto credit cards available is steadily increasing. This means consumers need to be especially discerning before making a choice. Here are six of the best crypto credit cards currently on the market. While each individual has their own needs and expectations, and should choose a card accordingly, you can’t go wrong by picking any of the cards on this short list.

 is one of the best crypto credit cards for anyone looking to take out large loans in cryptocurrency. You can use the card for 

 worth up to $2 million, with your current crypto holdings acting to secure the financing.

Even if you’re not interested in large-scale loans, the Nexo Card is still an appealing option. One major perk is its availability, with the card usable anywhere Mastercard is accepted. You can also earn up to 2% rewards in NEXO or up to 0.5% in BTC, a competitive rate that many cardholders are happy with. The associated smartphone app makes the card incredibly user-friendly, allowing you to easily set notifications, change your pin and freeze the card if it’s been lost or stolen.

If you already have the Venmo app, then the 

 will be easy and convenient to use. With the Venmo app, you can track purchases and monitor your rewards. The card itself is customized with a special QR for easy syncing.

With no annual fee and rewards of up to 3%, the card is financially favorable. Converting your rewards into crypto through the 

 feature allows you to fatten your digital wallet without taking on too much risk. The combination of financial payoff and convenience makes this one of the premier crypto Visa cards on the market.

The distinct rewards structure and wide compatibility of the 

 make it one of the best crypto credit cards available. 

Cardholders receive 4% back on both gas at the pump and EV charging, up to $200 per month (then 1% on all other gas at the pump and EV charging purchases that month), 3% on dining, 2% on groceries and 1% on all other purchases.

BTC, ETH or one of the other 50 cryptocurrencies compatible with the card.

Gemini Credit Card® is usable anywhere that accepts Mastercard. A user-friendly app makes it simple to monitor transactions and manage your account. In addition, there’s no annual fee.

While crypto credit cards are great for earning cryptocurrency in the form of cashback rewards, crypto debit cards are the better option for people looking to use the cryptocurrency they already own. With so many fantastic cards on the market, it’s never been easier to convert crypto into fiat and use it for everyday purchases. Here are 

 of the best crypto debit cards on the market, each of which has its own set of favorable properties.

Take your crypto on the go with one of the greatest crypto debit cards to hit the crypto space. The 

 takes crypto convenience to the next level, as it allows for hassle-free transactions without compromising on the all-important aspect of security. By partnering with Mastercard, Bybit ensures the widest array of merchant support and top-of-the-line security, thanks to 

, the Bybit card makes the off-ramping process flexible and easy, especially if you’re an experienced Bybit trader. By allowing for off-ramping via Spot, Derivatives and Margin trading, you might even be able to earn a tidy profit while converting your crypto into your preferred form of fiat currency. Combined with the Bybit card’s multi-asset spending feature, this grants users the ultimate freedom to manage their cryptocurrency balance and spend it to their heart’s desire. 

 and Samsung Pay, the Bybit Card enables you to 

 once you’ve applied for it. There’s no need for you to wait for your physical Bybit Card to arrive before spending. Furthermore, you can grow your bags by enabling Auto-Savings, which allows you to earn up to 8% APR on your Bybit Card balance. 

Bybit also offers a Rewards program whose users can earn a point for every 1 USD/EUR or 900 ARS spent, 

 varying point multipliers and monthly caps 

The points can then be used to redeem exclusive merchandise at Bybit’s 

bonuses and coupons. It can also be converted into cashback

 function to automatically receive the cashback on all purchases done with fiat and crypto in USDT. 

If you’re looking for a crypto prepaid card to sink your teeth into, then this is one of the best cards to consider. The 

 is the world’s first free metal- and crypto-linked prepaid card. With no fees, a straightforward top-up model that makes it easy to load your account with Bitcoin and other digital currencies, and an aggressive marketing campaign that's involved the likes of LeBron James and Matt Damon, it’s easy to see why many investors are owners. Once you’ve got the currency loaded, you’ll be able to instantly spend or withdraw it wherever Visa is accepted.

up to 10% cashback rewards in CRO on travel spending, and up to 8.5% cashback rewards in CRO on everyday spending.

 However, note that you would need to stake CRO in order to receive cashback rewards. 

The more CRO you stake, the higher your cashback rewards. 

The Crypto.com Visa also provides holders with reimbursements from subscription services such as Netflix and Spotify. Alongside the obvious benefit of making it easier to spend your cryptocurrency, these perks make the Crypto.com Visa Card one of the best crypto cards available.

 is among the best crypto debit cards for anyone already using Coinbase. You can use the card anywhere within the Visa network, and purchases and withdrawals are drawn directly from your Coinbase account. 

Crypto rewards are also significant, with cardholders receiving unlimited crypto rewards on every purchase.Furthermore, you can maximize your crypto portfolio by selecting your preferred rewards from a list of rotating cryptocurrencies, such as BTC, ETH, XLM, DAI and more.

If you’re a frequent Brave Browser user, you’ll likely come across the 

 wallet app that’s used to store your hard earned 

To make things more seamless for its users, Uphold has introduced its own crypto debit card, known as the 

. Users can spend crypto directly from their Uphold wallets.

 By featuring no annual fee, zero foreign transaction fees and low exchange rates, this UK-based crypto debit card is already leagues ahead of its traditional finance counterparts.

To further incentivize usage of the Uphold Mastercard, 

cashback rewards are doled out with a maximum cap of £100 per month, depending upon your location. Rewards are credited up to the 15th day of the following month.

 is one of the best crypto debit cards for international transactions. 

Users can enjoy up to $200 fee-free ATM withdrawals globally, and can use the card at more than 61 million locations globally wherever Visa or Mastercard is accepted. 

Compatible with over 150 different currencies, this is the crypto Visa card that every globetrotter needs.

Wirex offers cardholders rewards through its Wirex Cryptoback™ subscription service, where you can receive up to 8% in cashback rewards in the form of WXT tokens. You do, however, have to 

pay a monthly fee of up to €29.99 (or an annual fee of up to €306) if you wish to receive the highest tier of cashback rewards. The free version only enables you to earn up to 0.5% Cryptoback rewards. If you lock 150,000 WXT tokens for 180 days, you’ll be able to upgrade to the Standard Enhanced tier and enjoy 1% Cryptoback rewards on every purchase.

As far as convenience is concerned, the associated app makes it simple to set a budget, track spending and receive alerts.

For users just starting out with crypto, Choise, previously known as Crypterium, might be perfect since it offers consumers a crypto wallet with the 

 attached to it. This ultimately makes it easy for shoppers to access and use their crypto funds effortlessly as Choise seamlessly bridges fiat and crypto.

The Choise Card is a prepaid crypto card and largely appeals to the European market with its easy signup process. 

By offering users the choice of owning either the virtual or plastic Choise Card, Choise allows users to quickly convert their digital assets to cash when making purchases. While a virtual Choise Card is highly convenient for all contactless purchases, a plastic Choise Card is required for ATM cash withdrawals. 

The Choise Card comes with a monthly maintenance fee of €2.99, which is returned to the user via cashback as long as they load their card with €299 every month.

Users who open interest accounts on Choise can also enjoy up to 10% profit.

From one of the largest cryptocurrency exchanges in Spain, the 

 is a no-brainer if you live in Spain and are open to receiving your cashback in cryptocurrencies. This is because the Bit2Me Card charges no monthly fee or maintenance fee, and features zero ATM withdrawal fees when you withdraw within the European Union. This low barrier to entry makes Bit2Me’s Card an ideal choice for those new to crypto. 

Thanks to its established reputation as an entity registered with the Bank of Spain, the Bit2Me Mastercard can instantly deliver to users a virtual crypto debit card upon registration. 

Additionally, you’ll be able to earn up to 39% cashback by using the different Bit2Me products along with the Bybit Card:

This is an excellent crypto debit card for both beginners and experienced crypto investors. While the starting fee of $129 is higher than most crypto debit cards, and the $35 monthly fee is unusually steep, the 

 might well make up for the high cost of entry.

Club Swan’s concierge service helps holders book travel, order products and take care of mind-numbing administrative tasks. The card is also usable wherever Mastercard is accepted. If you’re on the lookout for an upper-tier crypto credit or debit card that really provides superior service, then this is probably the card for you.

One thing that can often drive users away from the prospect of earning crypto cashback rewards is the potential paperwork involved. Fortunately for newcomers to the crypto cashback space, the Visa crypto debit card from the Canada-based Shakepay exchange takes this entire registration process and streamlines it to be suitable for newcomers. 

To remove the hassle of card application processes, Shakepay waives the credit check phase so anyone can essentially be fully set up within minutes. Once users are fully registered and apply for their 

, they can look forward to earning up to 2% of their purchases in BTC, instantly credited to their Shakepay BTC balance. 

Dealing with crypto can be challenging if you’re new to the peer-to-peer (P2P) on-ramping and off-ramping scene. From exchanging your fiat for the right currencies to the nerve-wrecking moment of checking whether your transactions have gone through, it was certainly no easy feat to pull transactions off before the introduction of centralized exchanges. 

Thankfully, e-wallet corporations such as 

, have dedicated their business model to making such swaps easy, as users can quickly buy and sell while effortlessly switching between fiat and cryptocurrencies.

Once the swaps are done, users can then load their funds onto 

 — which function like prepaid crypto debit cards — and use them to spend their balance worldwide. With access to major markets around the world, users will have no trouble swapping and exchanging their funds to their desired currency for their personal use.

, one of the latest entrants to the crypto debit card market, has quickly become a new favorite, thanks to its instant-spending feature. Users can spend directly from their crypto wallets and pay with three tokens — USDC, USDT and/or WETH — on the Linea network, which offers lightning-fast, low-cost transactions. 

Not having any of the three abovementioned tokens isn’t an issue, as users can easily swap to them through their MetaMask wallets. Every USDC transaction grants you 1% cashback in the form of USDC, and you can even earn a yield on your wallet balance. 

MetaMask is also launching a Metal Card soon as part of a limited drop. Users interested in participating can join the 

 to be notified as soon as it becomes available. 

 offers premium rewards, exclusive event access and surprise perks, all of which are a step up from the MetaMask Card.

 is one of the best crypto debit cards available. Users can connect their wallets for deposit-free seamless payments, and send and receive crypto with no fees, which is perfect for anyone who frequently make cross-border payments. 

RedotPay offers both virtual and physical cards. The physical card has the added functionality of ATM withdrawals. 

There’s never been a better time to take out a crypto credit or debit card. The variety of available cards is steadily growing, and each option comes with a unique set of valuable perks. Now that you’ve learned about some of the best crypto credit and debit cards on the market, you should be ready to make your final choice. Whether you prefer huge amounts of cashback rewards or the flexibility of crypto-on-the-go, we hope our list of the best crypto credit and debit cards has your needs covered.

Keen on giving our attractive off-ramping process a shot? Experience trading with our various products by 

Beginner

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15 best crypto credit and debit cards for crypto beginners and crypto veterans in 2025

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Crypto Insights

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

Intro to Volatility Report Feb 2025

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: In January 2025, Bitcoin (BTC) and Ethereum (ETH) faced significant weekend sell-offs driven by macroeconomic factors, including Donald Trump’s U.S. tariff policies, expectations of a strategic Bitcoin reserve and disruptions from AI competitors like DeepSeek.

: BTC and ETH reacted more quickly and sharply than traditional equities did to economic and geopolitical news as leading indicators for Monday market movements, similar to the earlier yen carry trade unwinding in August 2024.

: Ethereum consistently underperformed Bitcoin during market dips in January 2025. However, the options markets reflected a lower implied volatility premium for ETH than expected, based on recent volatility comparisons.

Macro Factors Influencing Crypto Sentiment

In January 2025, the cryptocurrency market — particularly Bitcoin (BTC) and Ethereum (ETH) — experienced significant volatility largely driven by macroeconomic events. Key influences included U.S. president Donald Trump's unpredictable tariff policies and the emergence of artificial intelligence (AI) competitors such as DeepSeek, both of which created uncertainty in traditional and crypto markets. 

The turbulent sell-offs of BTC and ETH contrasted starkly with the relatively stable conditions observed during the Christmas 2024 period. This volatility was particularly evident on weekends, as crypto markets reacted more sharply to macroeconomic news than traditional equities, often serving as a leading indicator for market movements in the following week. For instance, the reaction to both subsequent labor market data and the hawkish tone from the Federal Reserve resulted in a notable sell-off of crypto assets before traditional markets opened.

Throughout January, a pattern emerged whereby the cryptocurrency market exhibited heightened volatility during weekend trading sessions, especially on Sundays. This trend was characterized by significant sell-offs that preceded the opening of traditional markets on Mondays. The chaotic environment was exacerbated by the launch of Trump-family meme coins and heightened expectations surrounding a strategic Bitcoin reserve, which led to rapid price fluctuations in crypto assets. 

Despite the initial bullish sentiment, these expectations were tempered by conflicting tariff reports, resulting in further volatility. This analysis highlights that the realized volatility — measured by 10-minute returns — spiked significantly during weekends, indicating that the crypto market is particularly sensitive to developments that unfold over the weekend.

Ethereum's Underperformance and Volatility Trends

January 2025 marked a challenging month for Ethereum, which consistently underperformed relative to Bitcoin during periods of market downturns. Despite ETH’s historical tendency to exhibit higher volatility than BTC, the options markets were pricing ETH’s implied volatility at a lower premium than its realized volatility. This discrepancy suggests that investors weren’t fully accounting for ETH’s increasing volatility in their market expectations. 

The emerging trends indicated a growing volatility premium for ETH as compared to BTC, with ETH exhibiting sharper price movements in both upward and downward directions. As January progressed, the divergence in performance between BTC and ETH underscored the unique dynamics within the crypto market, particularly as macroeconomic pressures continued to shape trader sentiment.

Events of January 2025 highlighted the intricate relationship between macroeconomic factors and cryptocurrency volatility. The sharp reactions of BTC and ETH to external events signify their role as leading indicators in the financial landscape, and the pronounced volatility during weekends and the distinct behavior of Ethereum relative to Bitcoin reflect an evolving market characterized by rapid changes and heightened sensitivity to external influences. As the landscape continues to shift, these trends will be critical for traders and investors navigating the complexities of the crypto market.

Bybit X Block Scholes Option Volatility Report (February 2025): January 2025 Marks New Start for Crypto, Shaped by Macro and Policies

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