In the past two weeks, there have been dark clouds hanging over the price of BTC, not only due to the massive outflow of spot ETFs but also because of the ticking time bomb known as Mt. Gox. Today, Mt. Gox trustees have officially started the repayment process for creditors. According to Nobuaki Kobayashi, the trustee of Mt. Gox, the compensation will be made in BTC and will begin in early July. Combined with the 14,000 BTC that was transferred from Mt. Gox addresses a month ago, the market immediately reacted with a safe-haven response to this news, causing BTC to experience a sharp short-term decline, briefly dropping below 61,000.
Source: Farside Investors; TradingView
In terms of options, the actual increase in volatility and market concerns about the future have significantly raised the level of implied volatility. At the same time, the volatility skew in the front end is positively correlated with the price, dropping into negative territory. Looking at BTC trading, before the news came out, despite the consecutive days of price decline, the market was mainly focused on long risky positions in the late June flow. Perhaps the low price attracted bottom-fishing for bullish options or there was trust in the key support levels at 61,000/60,000.
As for ETH, the President of The ETF Store once again stated that an Ethereum spot ETF may be launched next week, giving the community some hope. Market expectations have also pushed the smile curve towards bullish options from July onwards, in clear contrast to the front end. However, there seems to be some divergence in the market. In the case of high IV and high volatility skew, over 3,000 contracts of the July-end 4000-C were sold, becoming a trading hotspot yesterday.
Source: Deribit (as of 24 JUN 16:00 UTC+8)
Source: SignalPlus, IV rising after a sharp drop
Source: SignalPlus, Volatility Skew
Data Source: Deribit, Overall distribution of ETH trades
Data Source: Deribit, Overall distribution of BTC trades
Source: Deribit Block Trade
Source: Deribit Block Trade
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