Crypto Market Observations — DeFi and NFTs boost ALTs

Gains in DeFi and NFTs give Alts a boost as option market activity suggests a bullish bias towards ETH. Recent changes in open interest point to further consolidation in the current range.

There continues to be a general lack of market volume and on-chain activity as implied vol slides lower, DeFi yields compress, USDT market share hits an all time low, and stablecoin reserves remain at record high levels.

Options currently show a slightly more bullish bias for ETH relative to BTC, with 25d RR skew on ETH climbing up from the June lows whilst BTC remains relatively weak. Dec-21 $5000 ETH calls have seen the biggest change in OI, up 5040 contracts over the past week. Biggest OI increase on puts was for $2000 30-Jul, with BTC seeing most of the increase in July $40k calls and $30k puts. Recent changes in open interest aligns with the narrative that the market will continue to move rangebound for the immediate future.

DeFi has been leading the strength in Alts, with the DeFi index up 30% on the week and 71% from June lows

NFTs show excitement whilst the rest of market remains rangebound

USDT market share hits all time low, USDC and BUSD pick up most of the slack


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Crypto Market Insights and Thought Leadership by Covario AG.

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Crypto Market Insights and Thought Leadership by Covario AG.