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.

December's end-of-year options expiration brought an unexpected drop as realized volatility fell to the lowest levels of the month. Perpetual swap open interest remained stable, indicating these markets weren't heavily used for hedging against expired options, likely contributing to the muted volatility. 

While most expired open interest in Bitcoin (BTC) and Ethereum (ETH) hasn't been reinvested, the balance of calls and puts remains consistent. Notably, ETH options are pricing in higher implied volatility as compared to BTC, particularly for shorter expirations, leading to a flat term structure for ETH, while BTC is offering cheaper options exposure.

In the perpetual markets, low volatility and minimal spot movements have led funding rates for nearly all tokens to mirror broader market sentiment throughout the holiday season. On the options side, BTC's term structure is noticeably lower and steeper than ETH's, with realized volatility now dipping below implied volatility levels, highlighting an intriguing shift in market dynamics.

Please check out the report’s highlights.

Open Interest Solid Amid Year-End Options Expiration

Although open interest for both BTC and ETH perpetual swaps hasn’t returned to early December 2024 highs, it remained robust throughout the significant end-of-year options expiration event. This suggests that these markets weren’t heavily utilized to 

 of the expiring options contracts, likely contributing to the lack of volatility observed during this period. Instead, trading volumes have dipped noticeably during the winter holiday season, coinciding with a collapse in realized volatility back to December 2024’s lowest levels.

BTC Option Curve Remains Steep During Call-Put Parity

The expiration of December's end-of-year options didn’t trigger the anticipated surge in volatility; instead, realized volatility has plummeted to the lower end of its recent range. The implied volatility term structure remains steep compared to both its recent behavior and ETH's, with longer-dated implied volatility around 57%, and 1-week at-the-money options trading about five points lower. Much of the expired open interest hasn’t yet been rolled into new positions, maintaining a neutral balance between puts and calls. Consequently, BTC's options market positioning is relatively neutral, lacking the leverage it had at the start of December 2024.

Huge ETH Option Expiring Doesn’t Cause Volatility

A late December spike in realized volatility didn’t carry into the new year, with ETH’s spot price currently exhibiting volatility below that of short-tenor implied volatility. Interestingly, the implied volatility term structure has undergone a steepening and re-flattening over the past week, contrasting with BTC’s slightly steeper profile. This suggests that ETH’s options market is anticipating higher short-term volatility in spot price movements. 

Despite the significant expiration of options open interest at the end of December 2024, which didn’t lead to a rollover into later expirations, call options continue to dominate the market and have increased at the start of 2025.

Advanced

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Bybit X Block Scholes Crypto Derivatives Analytics Report (Jan 2, 2025): BTC Options Continue to See Call-Put Parity, With Lower Short-Term Volatility Expected

Dive into FLock, a decentralized platform that revolutionizes the way AI models are developed, trained and deployed.

Artificial intelligence (AI) is poised to transform countless industries, but its development often raises questions about privacy, control and inclusivity. 

 is a unique decentralized platform that democratizes AI training, fine-tuning and inferencing. With its blockchain-powered infrastructure, FLock ensures transparency, security and community-driven decision-making, paving the way for AI models that align with established societal values. 

In this article, we’ll explore how FLock decentralizes AI training, its key features and its potential impact on developers, communities and users.

 platform that revolutionizes the way AI models are developed, trained and deployed. By leveraging blockchain technology and a novel approach called 

, FLock addresses critical issues in AI development, such as centralized control, lack of transparency and privacy concerns.

At its core, FLock’s mission is to democratize AI by enabling communities to participate directly in the creation and refinement of AI models. Through federated learning, FLock trains AI models across multiple decentralized devices or servers. This method ensures that data remains local, eliminating the need for raw data exchange while still enabling robust model training. By decentralizing the training process, FLock not only protects individual privacy, but also fosters a more inclusive ecosystem in which diverse contributors can collaborate.

What sets FLock apart is its integration of 

. This ensures that all contributions — whether data, compute power or feedback — are transparently recorded and fairly rewarded. Blockchain tech’s immutable ledger enhances trust among participants and safeguards the process against manipulation. Additionally, the platform’s on-chain incentive mechanisms encourage participation from a wide range of contributors, ensuring that rewards are distributed equitably.

Ultimately, FLock empowers communities to develop bespoke AI models tailored to their specific needs. By decentralizing the process and prioritizing transparency and collaboration, FLock breaks the monopoly of large corporations, creating an AI ecosystem that aligns with public ethics and societal values.

, an Oxford alumnus with a robust background in AI and blockchain technology. Sun, who serves as FLock's CEO, has an impressive career trajectory, having worked as the Director of AI for the Royal Bank of Canada and as an AI Research Fellow at Imperial College London. His vision for FLock stems from a deep understanding of both the technical and ethical challenges of AI development.

The founding team also includes other Oxford alumni, boasting over a decade of combined experience in AI research and the cryptocurrency industry. This team brings a collective blend of academic excellence and practical expertise that positions FLock to lead the decentralized AI movement.

FLock has successfully raised $11 million in funding across two rounds, reflecting strong investor confidence in its vision. In May 2024, FLock secured a $6 million seed round co-led by Lightspeed Faction and Tagus Capital, with additional backing from Digital Currency Group (DCG), Volt Capital, OKX Ventures and Inception Capital.

Later, in December 2024, FLock announced a $3 million successful funding round led by DCG and joined by prominent names like Animoca Brands, Fenbushi Capital, GnosisVC and GSR. These investments are being channelled into enhancing the platform’s testnet and federated learning client, accelerating FLock’s mission of enabling secure, collaborative AI development.

With this funding and over 1,500 nodes contributing from platforms like Numerai and Kaggle, FLock is rapidly scaling its impact on decentralized AI training.

FLock AI revolutionizes AI development through its decentralized training framework. This approach allows participants to contribute to AI model training without ever sharing their personal data. Instead, models are trained locally across devices using federated learning, which ensures that data remains with its owners while still enhancing the accuracy of the model overall. 

FLock’s reward system is designed to incentivize active participation. Contributors who provide data, computational power and/or feedback are compensated with FLOCK tokens, ensuring a fair distribution of rewards. 

FLock empowers its community through a robust governance framework. Decisions regarding AI model development, deployment and ethical considerations are driven by the community, ensuring alignment with established societal values. Through blockchain-based voting mechanisms, contributors can influence the direction of AI projects, fostering transparency and public accountability. 

FLock’s modular architecture allows contributors to participate in specific aspects of AI model development. Whether providing raw data or computational power or even refining algorithms, the platform enables a collaborative and scalable development process. 

At the core of FLock’s philosophy is its commitment to privacy and security. By leveraging blockchain technology, the platform ensures that no single entity controls the AI development process. Data remains local and protected by cryptographic measures, while the immutability of blockchain guarantees transparency in every transaction and model update. 

 begins with a blockchain and an AI layer.

The blockchain layer underpins FLock’s incentivization and security mechanisms.

The AI layer facilitates model training, refinement and deployment, leveraging both centralized and federated approaches.

Let’s have a look at the supply and demand for the FLOCK token.

FLock adopts a 1:2 ratio model between team/investors (33.3%) and community (66.7%), prioritizing community-driven growth and ecosystem expansion. The majority of tokens are allocated to incentivize user participation and long-term ecosystem success.

FLock aims to improve the future of AI development by decentralizing the training process and ensuring transparency, privacy and inclusivity. By leveraging blockchain and federated learning, FLock empowers communities to contribute to AI creation without compromising on privacy. Its innovative reward system and community-driven governance foster a fair and collaborative ecosystem. 

With significant backing and a growing network of contributors, FLock is positioning itself as a leader in decentralized AI, offering a more ethical and secure alternative to traditional AI development models. As it continues to scale, FLock is set to transform the way AI models are built and deployed.

 — and earn a share of a 10 million FLOCK prize pool. For more details, visit 

Intermediate

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FLock AI: Decentralized AI Training

In this tutorial, we’ll explore how you can complete a series of tasks in Network3 for Bybit Web3 Airdrop Arcade.

Task 1: Register for a Network3 Account and Connect Your Bybit Wallet 

: Navigate to the campaign page and click on the 

task. Click on the task, and Galxe will ask to redirect you to the Network3 register page.

: Register for a Network3 account using your email address. You may indicate a 

Task 2: Download the Network3 App and Run a Node for One Hour

 and choose your operating system to download the Network3 app.

 or powerbutton, depending upon which operating system you’re using. For ease of reference, we’ve used macOS and iOS as examples below.

: Keep running the node until the timer reaches 

Beginner

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How to Complete Network3 Tasks for Bybit Web3 Airdrop Arcade

Bybit launched the Bybit Merch Creative Challenge for university students worldwide, offering a $50,000 USDT prize pool.

The S&P 500 dropped 0.22% on Thursday, its fifth straight decline, with investors eyeing Friday’s economic updates. Coindesk Indices, an index measuring broader cryptocurrency market performance was up by 2.03%, with Bitcoin and Ether rising by 2.79% and 2.70%, respectively in the past 24 hours.

Today's top performer is XRP, which surged 1.9% following a rise in price driven by increased open interest and positive market sentiment.

Ripple (XRP), launched in August 2012, is a blockchain technology company focused on improving international payments with its cryptocurrency, XRP. XRP price surged due to increased open interest, a major XRP transfer, and market sentiment linked to Trump's inauguration. Bullish momentum is supported by high short liquidations, with key resistance levels to watch for further price movement.

Check Out the Latest Prices, Charts, and Data of 

 for university students worldwide, offering a $50,000 USDT prize pool. Participants can design exclusive Bybit merchandise, with submissions open until Jan. 15, 2025. Winners will be announced on Feb. 1, 2025, across four prize categories.

Yesterday, Bitcoin Spot ETFs recorded a total inflow of $84.8M, driven by $107.9M from non-GBTC funds, partially offset by a $23.1M outflow from GBTC.

, offering an airdrop for participants who complete tasks like swapping and bridging using the Mango wallet. Points earned through tasks determine airdrop rewards. Join via the Mango wallet and follow steps on the testnet dashboard.

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Bybit Launches $50,000 Merch Design Challenge for University Students Worldwide

Bybit Learn

Trading

Discover whether crypto day trading is halal or haram according to Islamic finance principles, as we explore key considerations for Muslim traders in the evolving cryptocurrency market.

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 has been a popular way of making a profit in financial markets for centuries, and has become particularly common since the growth of computer-assisted trading platforms in the 1990s. Day traders try to capitalize on asset price movements during a single trading day. Commonly used in 

 markets, day trading has also been enthusiastically embraced by the cryptocurrency trading community over the past few years.

However, the acceptability of crypto day trading from an Islamic law perspective remains a gray area, with many Muslim investors uncertain whether it's a halal (permitted) or haram (prohibited) activity. This article covers the basic concepts related to cryptocurrency day trading and its alignment with core Islamic principles.

Day trading is a form of market activity in which a trader buys and sells assets during the same trading day, with the purpose of making profit from price fluctuations. The key goal of a crypto trader is to buy an asset during a price dip, and then sell on the same day when the price rebounds to higher levels. Using computerized trading solutions, day traders might place anything from a few to many hundreds of trades. Highly popular in the stock and forex markets, day trading has also been increasingly used for trading crypto as well.

Crypto day traders take advantage of cryptocurrencies' price volatility and the crypto market's 24/7 availability to try to make a profit. Most crypto day trading activity involves high-cap crypto assets, such as 

 (SOL). Some traders might adopt a high-risk strategy and trade low-cap, sometimes obscure crypto assets in the hopes of making large profits that may not be easily derived using high-cap coins.

The vast majority of crypto day trading takes place on 

 (CEXs), although a smaller share also occurs on blockchain-based 

Understanding Islamic Finance and Crypto Trading

Islamic finance is part of Shariah, or the set of laws and regulations that guides Muslims' personal, communal, ethical and financial activities. Fundamental principles of Islamic finance define what is permissible (halal) for Muslim investors and what is not allowed (haram). Islamic finance principles explicitly forbid Muslims to use financial products and assets linked to interest (riba), excessive uncertainty (gharar) and gambling/speculation (maysir).

Under certain circumstances and conditions, trading cryptocurrency may be a legitimate activity for Muslim investors. Many crypto trading operations involve no riba, gharar or maysir. For instance, the simple act of buying Bitcoin and holding it as a store of value involves no interest payments, nor is it associated with market speculation or uncertainty. In this scenario, the investor simply assumes possession of the asset and stores it in their exchange 

 or at their blockchain address, without worrying about its price volatility or the uncertainty or speculation that might be linked to that volatility.

However, for Muslim investors, the acceptability of crypto day trading — which involves frequent buy-and-sell operations in an attempt to capitalize on short-term price movements — is a topic that is less clear.

Is Crypto Day Trading Halal — or Haram?

The lack of certainty about the halal status of crypto day-trading activities is largely due to the absence of a unified opinion of Islamic scholars and institutions on this matter. Those Islamic scholars and advisories that issue notes and opinions on the Shariah-compliant status of cryptocurrencies have rarely addressed the specific case of crypto day trading, in most cases expressing their views on crypto in general. 

Notable scholars or institutions that consider cryptocurrencies to be haram include the former Grand Mufti of Egypt, Dr. Shawki Allam; the prominent UK-based Islamic scholar Sheikh Dr. Haitham al-Haddad; and Turkey's General Directorate of Religious Affairs (or Diyanet). Scholars who normally consider crypto to be haram cite the lack of regulation for these assets, which creates the risk of using them for illegal activities; their ambiguous real-world value, due to their completely digital format; and the speculative nature of many crypto trading operations.

However, many other Islamic scholars and institutions consider crypto to be halal in general, provided it's not used in activities connected to riba, gharar or maysir, and isn't linked to haram products or industries. Many of these scholars advise Muslims to take a selective approach and look at the specific details of each cryptocurrency or crypto product. Among notable scholars who advocate for a generally halal view on crypto are Dr. Ziyaad Mahomed, Chairman of the HSBC Amanah Shariah Board in Malaysia; Mufti Muhammad Abu Bakar from Minhaj Advisory, Dubai; and Mufti Faraz Adam, head of Amanah Advisors, a global Shariah advisory firm.

Gauging the Permissibility of Crypto Assets

Given the difference of opinions on crypto and the lack of direct rulings specifically concerning crypto day trading, Muslim investors are often left uncertain concerning the legitimacy of this activity. In general, crypto day trading might be viewed as halal if it doesn’t involve:

 crypto day trading might be permissible if it involves relatively stable, established crypto assets whose price movements are more defined and follow market logic, rather than hype or speculation. Spot trading also allows traders to directly own an asset. Moreover, in cryptocurrency markets, day trading operations 

 are settled nearly instantly or within seconds, so that traders aren’t left in a scenario in which they’ve placed a trade but haven't assumed ownership of the asset. 

In contrast, in traditional financial markets — e.g., stocks, bonds, commodities and forex — a day or two can elapse between a trade’s placement and settlement. This delay in assuming ownership of an asset is often cited by Islamic scholars as a violation of Shariah principles.

Practical Considerations for Muslim Crypto Traders

Some astute Muslim crypto day traders may be able to assess each situation and make a confident decision about the halal status of each of their financial transactions. However, for many others, the decision is far from straightforward. For such traders, the safest approach is to use 

 at established crypto trading platforms. Naturally, each account still needs to be scrutinized with regard to the absence of riba, gharar and maysir.

Bybit offers Muslim crypto investors (including day traders) a specifically designed and endorsed 

 that satisfies the requirements of Shariah law. The 

 lets you trade crypto with peace of mind by ensuring that all your trading activity remains compliant with Shariah law.

So, is crypto trading halal? And specifically, can crypto day trading be viewed as a halal activity? In an atmosphere of conflicting advice and uncertainty, it can be challenging for Muslim traders to confidently answer this question. 

In closing, it’s likely that your crypto day trading activities will qualify as halal if you: 

Disclaimer: Due to varying opinions on Shariah compliance of crypto trading, we recommend you to conduct your own further research. Please note that the posts on Bybit Learn should not be considered as fatwa. Our aim is to present information on different topics to empower readers to make informed decisions.

Is Crypto Day Trading Halal? Everything You Need to Know

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Grab Up to 5,000 USDT in Rewards