Increased drive in cryptocurrencies following the Consumer Price Index (CPI), yet potential risks from leveraging accumulate

In an exclusive post for our premium subscribers, we delve into the latest developments in the cryptocurrency market. To access this valuable content, a sign-in is necessary, and only those with an active subscription can partake.

The post begins by highlighting the significant milestones achieved by Bitcoin (BTC) and Ethereum (ETH). Bitcoin is closing in on the $120K mark, while Ethereum has reached $4.7K. These price movements indicate a bullish trend in the market, and our analysis suggests that this could be the start of a prolonged period of growth.

However, the post also raises concerns about the volatility risks associated with top altcoins. The build-up of leverage across these assets has led to a potential sharp realized volatility expansion. This is primarily due to low implied volatility pricing across all maturities, a trend that has been observed recently.

The increased volatility risk is evident in the record Open Interest of $47 billion on top altcoins. This surge in Open Interest is largely attributable to whale investors accumulating positions, as indicated by the top 100 addresses holding nearly 30% of the supply in assets like Cardano (ADA). Despite the price stagnation, whales continue to buy, signalling a strong belief in the long-term potential of these assets.

The post also discusses the current monetary policy landscape, with the Fed cut odds near certainty. The recent CPI surprise has reinforced expectations of a rate cut, which could further boost the cryptocurrency market.

In conclusion, this post provides exclusive insights into the current state of the cryptocurrency market, highlighting both opportunities and risks. To gain access to this post and other premium content, subscribe today! Non-subscribers will unfortunately be unable to view this post.