Asia Colour

As the market continues to trade sideways, BTC dominance has risen to approximately 60%, nearing 4-year highs as ETH and other altcoins continue to underperform. This past weekend’s $LIBRA’s “rug pull” scandal involving Argentinian President Javier Milei, does not bode well for similar projects or for those anticipating an altcoin/memecoin season.

With BTC comfortably back in the middle of the range, implied vols continue to drift lower which comes as no surprise given that 7d realized vol has dipped to 36v. With no significant crypto-specific catalysts in sight, price action appears to be more macro driven particularly as the correlation between BTC and equities remains largely intact.

However it is interesting to note that despite the macro uncertainties (tariffs, debt ceiling, inflation etc) and the unpredictability of Trump, crypto implied vols and VIX are still trading at their lows. BTC has proven to be relatively unfazed by the recent macro data and OI has not recovered significantly after the January month-end expiry. This suggests that the crypto options market is just waiting on the sidelines for concrete policy changes rather than just pro-crypto rhetoric.

The market remains undecided on whether it is worth paying for decay even with vols at these levels, which are reminiscent of Q2-Q3 last year when BTC struggled to break out of its multi-month range. Instead, most of the flows have been near dated vol selling or trying to trade the range rather than positioning for a big breakout.