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The world’s largest cryptocurrency Bitcoin (BTC) witnessed a sharp 10% correction, falling to $65,500 from its all-time high. This decline in Bitcoin‘s price helped reduce overall volatility as investors eagerly awaited the expiry of Bitcoin options on Friday.
Critical Data in Bitcoin Market
According to Greeks.Live, BTC‘s Dvol dropped below 70%, indicating that the downward pressure on implied volatility continues as noted at the end of the previous month. Recent block trade activity showed a decline marked by whales purchasing put options after the Bitcoin halving. This significant margin offered to these large investors underscores the importance of monitoring their subsequent actions. Data from Greeks.Live also indicates that 18,000 BTC options characterized by a put-call ratio of 0.64 and a notional value of $1.2 billion are nearing expiry at a strike price of $68,000.
This week saw a weaker performance in the crypto market. Selling transactions emerged as the dominant trades of the week, accompanied by a notable decrease in implied volatilities across all main terms. While Bitcoin is benefiting from post-halving sentiment support, other cryptocurrencies are experiencing a short-term bear market. Additionally, the market’s absorption of premiums from ETFs has led to a slowdown in ETF inflows recently.
Current State of Bitcoin ETFs
Overall entries into the Bitcoin ETF market decreased this week, with net inflows remaining around $100 million daily. Moreover, outflows from GBTC reached their lowest monthly levels, while inflows into BlackRock’s IBIT and Fidelity’s FBTC are on the decline. On Thursday, the total Bitcoin ETF inflow was at the level of $106 million. BlackRock’s IBIT saw an inflow of $144 million, while GBTC recorded an outflow of $79 million.
However, it has been revealed that the inflows into spot Bitcoin ETFs over the past two months have significantly contributed to the increase in BTC’s price to $73,500. Bloomberg ETF strategist Eric Balchunas shared his observation that the majority of Bitcoin’s 40% gain since the ETF launch was observed after trading hours, leading to significant price gaps between closing and opening prices. He highlighted a notable graph showing the disparity between intraday and after-hours returns for IBIT.
