Bearish sentiment grows as crypto volatility and
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- Bitcoin's rally to $68,300 quickly reversed to $66,500, with its implied volatility (BVIV index) climbing to 58%, signaling increased turbulence.
- Cumulative industry-wide crypto futures open interest dropped over 3% in 24 hours, continuing a first-quarter trend that has seen an 18% decline since the start of the year, indicating capital outflows from major cryptocurrencies like BTC, ETH, SOL, and XRP.
- Options markets show a strong bias for put options, with the $60,000 BTC put being the most crowded trade at $1.50 billion in open interest, reflecting significant demand for downside protection.
- ZEC's futures market stands out with bullishness, as its open interest rose more than 3% alongside positive funding rates, suggesting increasing demand for bullish exposure, contrasting with broad market declines.
- The war in Iran, now in its 32nd day, has sent Brent crude to $107 per barrel, fueling inflation concerns and a risk-off sentiment that contributed to crypto's weakness after Bitcoin failed to surpass $75,000 twice.
Why it matters: Crypto futures open interest has declined over 18% this year, indicating significant capital outflows from major tokens.
