The cryptocurrency market is witnessing an influx of speculative trading, particularly with meme coins like DOGE, PEPE and BONK experiencing extraordinary gains. 

November 2024 has marked a significant milestone for Bitcoin, with its price soaring to $94,105. This unprecedented growth has been driven by global events and heightened social media discussions, with predictions of six-figure valuations. Historically, peaks in social media chatter often precede market corrections, signaling traders to exercise caution. Currently, while whale accumulation remains strong — with wallets holding over 10 Bitcoin adding 53,006 more BTC in just one month — retail traders remain surprisingly cautious. This wary sentiment contrasts sharply with the bullish behavior usually seen during price surges, suggesting a potential correction.

The cryptocurrency market is witnessing an influx of speculative trading, particularly with meme coins like DOGE, PEPE and BONK experiencing extraordinary gains. Despite their volatility, these tokens reflect a broader appetite for high-risk investments. Notably, whale investors holding 1M–100M DOGE are accumulating, while smaller holders are selling, creating conditions for potential breakouts. However, if new capital stops flowing, these speculative assets could face significant downturns. Additionally, while discussions around Bitcoin reaching $100K are increasing, they haven’t reached the levels seen earlier this year, indicating that fear of missing out (FOMO) may not yet be fully realized.

Institutional Interest and Ethereum's Resurgence

Demand for Bitcoin ETFs has surged, with daily trading volumes hitting a record $8.21 billion, signaling increased institutional interest. This activity often coincides with market peaks, but could also indicate new investments flowing into the crypto space. Meanwhile, Ethereum has also gained momentum, breaking above $3,100 for the first time in over 14 weeks. Additionally, whale accumulation is on the rise, suggesting that as Bitcoin leads the market, profits may soon be redirected into Ethereum. In contrast, Solana's price movements remain highly sentiment-driven, with funding rates indicating potential entry points for investors. Overall, altcoins are experiencing growth, particularly following the U.S. elections, which have reignited optimism in the crypto market.

Advanced

Intro to Santiment.png

Bitcoin's Resurgence: Analyzing Market Dynamics and Speculative Trends in November 2024

Crypto market makers play a crucial role in providing liquidity by consistently placing buy and sell orders. Learn more about how they work here.

The cryptocurrency market is notorious for its high volatility and sometimes low liquidity, making it a challenging environment for traders and investors. Executing trades can be difficult, often resulting in significant price 

Market making is a strategic approach that provides the necessary liquidity to stabilize markets, ensuring smoother trades and reducing volatility. By creating buy and sell orders around the current market price, market makers help maintain a healthy trading ecosystem. This article examines the fundamentals of market making, its benefits for traders and exchanges and the way it enhances the overall efficiency of the cryptocurrency market.

A crypto market maker is an entity or individual who primarily provides liquidity in cryptocurrency markets by continuously placing buy and sell orders for digital assets. This activity ensures efficient trading and helps maintain stable prices.

Crypto market makers play a key role in keeping markets liquid by continuously placing buy and sell orders on exchanges. Here's a closer look at how they operate.

Key Characteristics of a Crypto Market Maker

Crypto market makers provide liquidity and stabilize prices in the cryptocurrency market. The following are the key traits that enable them to operate effectively.

Market makers continually place buy and sell orders, ensuring the availability of transactions for traders. This constant availability reduces wait times for trades and minimizes the price impact of large orders, making the market more efficient and accessible for everyone.

One of the fundamental roles of market makers is that of managing the bid-ask spread. By consistently quoting competitive prices, they narrow this spread, thereby enhancing trading efficiency and reducing costs for other market participants. This spread is also their primary source of profit.

Market makers leverage advanced algorithms and HFT strategies to analyze market conditions and optimize their order placements. This technology allows them to react swiftly to price changes and maintain a balanced inventory of assets, which helps to manage risk and maximize profitability.

Due to the inherent volatility of cryptocurrency markets, effective risk management is vital for market makers. They employ various techniques, such as hedging and real-time market analysis, to minimize exposure to sudden price swings. This ensures their operations remain stable even in the face of market fluctuations.

By providing continuous liquidity and facilitating smooth trading operations, market makers enhance overall market efficiency. Their presence attracts more traders, which increases transaction volumes, boosts exchange activity and contributes to a healthier trading environment.

Given the quickly evolving nature of the cryptocurrency landscape, market makers must be adaptable, continually refining their strategies in response to new technologies, regulatory changes and shifts in market dynamics. This ensures they remain competitive and relevant.

Crypto market makers play a critical role in the cryptocurrency ecosystem by providing liquidity and stabilizing prices. Despite the integral role they play, however, their operations come with both advantages and disadvantages. 

Additional Importance of a Crypto Market Maker

Crypto market makers play a vital role in maintaining the efficiency and stability of the cryptocurrency market. Their presence on crypto exchanges ensures trading environments operate smoothly. 

Newer and smaller cryptocurrencies often struggle with liquidity. Market makers provide a market for these assets, promoting their growth and creating a more diverse and dynamic crypto ecosystem.

Through continual quoting of prices, market makers aid in fair price discovery, ensuring that cryptocurrency prices reflect actual market demand rather than extreme fluctuations. This promotes a more trustworthy and transparent trading environment that allows traders to make data-backed decisions. 

Crypto market makers are essential players in the cryptocurrency ecosystem, providing liquidity, stabilizing prices and ensuring smooth trade execution. Their use of advanced algorithms and real-time order placements encourages a more efficient, accessible and fair market. However, risks such as market manipulation, potential capital loss and lack of regulation can be problematic. Overall, the role of market makers in supporting emerging assets and maintaining market stability makes them indispensable for a healthy and growing crypto environment.

Intermediate

market maker.png

Crypto Market Maker: Boosting Trades With Strategic Liquidity

SEC Chair Gary Gensler announced he will resign on January 20, 2025, coinciding with President-elect Donald Trump's inauguration.

The S&P 500 rose 0.53% as investors shifted toward cyclical stocks expected to benefit from a strengthening economy, while technology shares lagged. Coindesk Indices, an index measuring broader cryptocurrency market performance was up by 4.79%, with Bitcoin and Ether rising by  4.19% and 8.75%, respectively in the past 24 hours.

Today's top performer is XRP, which surged 24.3% following the partnership between Ripple and MCSocialVenture to boost financial resilience and access in emerging markets.

Ripple (XRP), launched in August 2012, is a blockchain technology company focused on improving international payments with its cryptocurrency, XRP. 

, focused on investing in emerging market entrepreneurs. The initiative will pilot financial resilience and humanitarian solutions built on the XRPL, aiming to advance equitable access to finance.

Check Out the Latest Prices, Charts, and Data of 

 he will resign on January 20, 2025, coinciding with President-elect Donald Trump's inauguration. Gensler, whose term runs until 2026, faced pressure from the crypto lobby due to the SEC’s strict regulatory actions against the industry, including high-profile cases against Coinbase and Binance. Gensler’s departure is seen as a victory for crypto advocates, who hope the next SEC chair will be more crypto-friendly. Trump has hinted at firing Gensler on his first day in office and is expected to appoint a chair with expertise in crypto, such as Mark Uyeda, Hester Peirce, or Chris Giancarlo.

Yesterday, BTC Spot ETF data revealed a net inflow of $396.7 million, driven by $404.5 million from non-GBTC sources, partially offset by a $7.8 million outflow from GBTC..

 for those who participated. To claim, visit 

 using code B0FKOP. Additionally, Morph Zoo Season 2 has launched on mainnet, allowing users to earn points by bridging ETH or executing transactions on Morph. The Bitget Wallet offers a 1.2x multiplier on points to maximize rewards.

Beginner

4.png

SEC Chair Gary Gensler to Resign on Inauguration Day, Marking a Win for Crypto Lobby

Traders seem to expect BTC’s momentum could slow down a bit after the price hit over $97,000.

Positive sentiment has continued to fuel the cryptocurrency market as the expectation of further institutional adoption of 

 keeps growing. Options trading of BlackRock’s Spot Bitcoin ETF IBIT 

 with a bang, attracting almost $2 billion on the first day of trading. The hope of more spot ETF derivatives to change the market structure with additional institutional money onboarding crypto is high.

, we explored the possibility of the market being overleveraged, which could be painful if the current leverage unwinds. Data from CryptoQuant shows that the estimated leverage of the current BTC markets has reached another YTD high.

Derivatives data on Bybit shows that traders seem to expect that BTC’s momentum could slow down a bit after the price hit over $97,000, and are focusing more on downside protection.

Figure 1: Bitcoin estimated leverage ratio at 0.23. Source: CryptoQuant

BTC Options Open Interest Returns to Previous High While Perps Are Catching Up

Derivatives traders have been actively participating in BTC markets as 

 on Bybit has surged to over $3 billion, on par with the previous high on Nov 14, 2024. Although the options OI has increased, it still hasn’t surged above the previous high. At the time, BTC’s price had already jumped to over $97,000. If the OI doesn’t follow suit and break above the previous high in the coming days, this could be a sign that the market could become a bit exhausted — something for all market participants to be aware of.

Figure 2: Daily open interest for BTC options on Bybit. Source: Bybit

 have also seen increased open interest in recent days. Perpetuals have been among the most favorable products for day traders and short-term speculators. Rising open interest could indicate that more traders are looking for short-term profit, which could bring additional volatility to the market. 

Figure 3: Daily open interest for BTCUSDT Perpetuals on Bybit. Source: Bybit

Dec 27, 2024 remains the most popular expiration date for BTC Options on Bybit, with most of the open interest there. Within that expiration, $120,000 calls had the most OI, and $100,000 calls accumulated the second-largest OI. 

Figure 4: Open interest by strike for BTC Options with a Dec 27, 2024 expiration. Source: Bybit

Meanwhile, the market’s optimism that BTC will hit $100,000 by the end of the year seems to support the current price momentum. Shorter-dated options could show that traders are also looking for downside protection. The Bybit 

 page shows that BTC Options with a Nov 29, 2024 expiration have a strong 24-hour inflow to $90,000 puts. This could indicate that some traders are also anticipating some degree of price correction by the end of the month. 

Figure 5: 24-hour volume by strike for BTC Options with a Nov 29, 2024 expiration on Bybit. Source: Bybit

 for BTC Options on Bybit also indicates a possible downside protection in play among options traders. A smirk skew, or left skew, is a skew curve that’s steeper on one side (the left side) than the other. Traditionally, a smirk skew curve could mean that traders have been protecting their portfolios against a possible declining market. At the time of this writing (Nov 21, 2024), BTC Options contracts on Bybit with Nov 29, 2024 and Dec 27, 2024 expirations have both shown a smirk skew. However, this doesn’t necessarily mean traders are bearish on the price, and could just be part of the trading strategy. For example, traders could set up collars by buying out-of-the-money (OTM) puts and selling OTM calls simultaneously, so that they can profit in case BTC’s price drops, gain upside exposure and potentially offset the cost of buying the puts. 

Figure 6: Implied volatility of BTC Options with Nov 29, 2024 and Dec 27, 2024 expirations. Source: Bybit

The current BTC leverage trading may be complex, but tells a revealing narrative about market sentiment. The divergence between high leverage and increased hedging activities also reminds us that market dynamics are rarely straightforward, and adopting a 

 seems increasingly important in this diverse market.

: 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.

NOV24_R53_Learn From Smart Money_ BTC’s Leverage Remains High as Traders Hedge Against Downside Risks.png

Learn From Smart Money: BTC’s Leverage Remains High as Traders Hedge Against Downside Risks

Bybit Learn

Strategies

Event-driven trading is a strategy that seeks to exploit pricing inefficiencies, which may occur before or after a key event. Learn more here.

Event-driven trading strategies have long been employed by private equity traders and hedge funds as they conduct in-depth research on upcoming corporate events, calculating the rate of success and whether the payoff is worth undertaking the risk. From mergers and earnings announcements to share offerings and executive resignations, such instances often cause huge volatility as short-term traders buy and sell according to existing sentiment. 

In the case of cryptocurrencies, while the general strategy remains the same, traders instead pay attention to key crypto-related events like blockchain upgrades, strategic partnerships and regulatory changes. Read on to find out how this event-driven trading strategy plays out in an actual scenario.

Event-driven trading is a strategy that seeks to exploit pricing inefficiencies, which may occur before or after a key event. In the context of crypto, these events include blockchain upgrades, mergers, acquisitions, strategic partnerships, central bank data announcements and regulation changes.

There are generally two types of events that event-driven trading strategies target: pre-event and post-event. Trading the pre-event hype involves planning, so traders can take advantage of the upcoming volatility that they know usually accompanies such a key event. Post-event trading involves careful analysis of existing demand and supply zones so traders can leverage upon increased trading volume caused by fear-of-missing-out (

Event-driven trading involves several steps. First, traders identify upcoming events that have the potential to greatly impact an underlying crypto's price. Examples range from the 

 to regulators potentially stepping in to start a 

Once the event is identified, traders then analyze how the market will react to the news, and whether there's any validity to the sudden volatility. This involves comprehensive research to ensure all scenarios and potential happenings are taken into account before deciding whether or not the traders want to take a position in anticipation of the event. 

If so, they then decide what type of order to place — either a buy or sell limit order — at which point they can set up their trade. For more advanced crypto traders who have experience in 

 can be deployed, with crypto options in particular being especially handy since the increased volatility will bump up the implied volatility of the option. This will ultimately make writing the option contract that much more profitable.

One key strategy is to be disciplined with existing capital, and to understand the potential risks involved when it comes to the event’s impact. Take-profit levels should be placed, so traders can lock in their profits despite ongoing volatility. If the market moves unexpectedly, planned stop-loss orders should be executed to protect trading capital, and to keep account balances from being wiped out with a single trade.

Event-Driven Trading Example: Ethereum Merge

Hyped up as the biggest crypto event of 2022, the crypto space was filled with buzz for the 

 prior to its completion in September 2022. As a result, speculation was at all-time highs as event-driven traders began to theorize and plan for the upcoming volatility. 

From optimists expecting FOMO buyers to cause ETH prices to skyrocket, to bearish traders asserting that the Merge could be potentially delayed, there were various schools of thought when it came to the notion of profiting from the Ethereum Merge. 

After it officially took place, ETH prices tumbled by close to 4% that day, as traders were quick to buy the rumor and sell the news. Like most telegraphed events and catalysts, the Merge was already priced into Ethereum’s fundamentals, and failed to cause a larger move than expected. This ultimately allowed both bearish ETH traders and those who wrote ETH contracts to profit from the volatility.

Event-driven trading does offer several benefits, particularly when it comes to crypto. Here are a couple to take note of.

Planning for Events Encourages Increased Risk Management

If you don’t plan to succeed, you’re planning to fail. This well-known adage holds extra weight when trading and speculating on the impact of upcoming events and catalysts. Cyclical events, like earnings calls and U.S. Federal Reserve meetings, can often be backtested to gauge their impact on specific assets. Traders can then gauge a rough understanding of the assets’ price movements. As traders plan ahead, they’ll be more aware of 

 before diving into a trade, which can contribute to their overall 

 as they decide when to take profit or cut losses.

Event-driven trading also gives traders a way to earn potential profits without having to continuously monitor the market or day trade. By conducting personal due diligence on upcoming catalysts, and planning for trades, limit orders can be set up before an event occurs. This allows traders to stay on top of markets without being glued to their charts all day long, and can prove beneficial for those who don't have the time to 

While event-driven trading can be a lucrative strategy when done properly, it carries certain dangers that traders should be aware of before diving in.

One of the central risks is that events may not unfold as expected, or may even result in a big price movement that could lead to losses for traders who dabble in crypto options and are expecting a huge move in either direction. As an example, we’ll use the case of traders purchasing option contracts ahead of a hotly anticipated blockchain upgrade. If the market fails to react with as much volatility as expected, those trades may end up being unprofitable as implied volatility falls, immediately crushing the premiums of the purchased option contracts.

Another risk is that event-driven traders can be susceptible to manipulation. Since traders are reacting to news and events, they may be exploited by market makers or large institutions that have the capital advantage over retail investors. Such 

 can easily change market sentiment with their large-volume buys and sells. This may result in greater-than-expected losses if traders are caught on the opposite end of their trades. Therefore, it’s key for traders to take these potential risks into account, respond quickly enough to cut their losses and protect their existing capital where possible.

Tips on How to Profit From Major Crypto Events

When it comes to successful event-driven trading, there are several important tips for all traders to take into account.

Not Getting the Short End of the Bid-Ask Spread

Inexperienced traders may fall prey to emotional trading when trying to get their entry or exit orders filled. This can result in the immediate use of market orders. While this gets the job done, it can result in a bad average entry or exit price when the 

 is too wide. Thus, we recommend using predefined limit orders to take advantage of price movements, without having to constantly check the markets. This provides more flexibility and control over trades, letting you capture quick profits while avoiding large losses in case of an unexpected market move.

The central tenet of due diligence cannot be overstated. For event-driven trading, traders must be aware of the impact of an event and how it can impact the fundamentals of a specific coin or token. That’s why it’s key to 

 and stay up-to-date on all news and events related to a project. Knowing what upcoming events may cause a price movement or have an impact on market sentiment can be immensely beneficial when formulating an event-driven strategy. To form the basis of your due diligence process, we recommend following relevant 

As with all forms of active trading, risk management is key for successful event-driven trading. It allows traders to protect their investments, especially if events don’t unfold as anticipated. Manage the risk of your entries and exits by setting reasonable stop losses in case things don’t go according to plan. It’s also important to make use of 

, which involves limiting the size of each trade per your overall risk appetite and capital allocation.

Whether you’re a beginning or experienced trader, event-driven trading can definitely be a useful strategy if you want to take a more active role when speculating. By taking advantage of price movements that result from key events related to a specific coin or token, well-informed traders can stay ahead of the curve and make use of the ensuing volatility to profit. 

While there are certain risks that come with this type of trading, it allows those actively involved in the market to plan ahead, and avoid making trades based on their emotions. As previously mentioned, doing your research enables you to manage risk within your means. In addition, using limit orders instead of market orders can help you make use of event-driven strategies to potentially snap up quick profits while limiting losses in case things don’t go as expected.

In conclusion, event-driven trading can be a lucrative strategy for those who have done their research and are prepared to respond quickly to the markets when news and events take place. With proper risk management and execution, it’s possible to generate consistent returns from event-driven trading. However, there are also risks involved with event-driven trading, so traders must remain vigilant about potential pitfalls that may arise when things don’t go according to plan, and stay calm in order to keep trading losses to a minimum when using this strategy.

Event-Driven Trading: Profiting Off Major Crypto Events

Grab Up to 5,000 USDT in Rewards

Grab Up to 5,000 USDT in Rewards