“Inflation is the more pressing concern”

Find out our latest reports, listed below:

• Bybit x Block Scholes Quarterly Report: Rise of Perp DEXs — and how to catch the opportunity

• How did options markets react to the crypto selloff?

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• Metaplanet Is Selling Vol, Who Is Next?

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• Bybit x Block Scholes August Volatility Review

Market Snapshot: Overnight Moves:

Daily Updates:

• After falling below $100K for the first time since June 2025 earlier this week, BTC has since traded between $100K and $104K. 
• Over the past week, it’s down 7.5% with a year-to-date performance of 8.6% — that’s an underperformance relative to both the 14.5% gain in the S&P 500 and the 52% gain in gold. 

• Investors are showing very little appetite to re-enter the market too. In our weekly Bybit Derivatives Report (look out for this later today), we cover the continued sideways slog in the open interest of perpetual futures contracts which remains far lower than its pre October 10 levels. 
• In that report we also highlight that the lack of retail participation in leverage trading has also occurred alongside what could turn into a trend of DAT firms selling crypto holdings. Over the past two weeks, two treasury firms, Sequans Communications and ETHZilla sold 970 BTC, and $40M worth of Ether, respectively. 
• While the latter sale was part of the company’s initiative to buy back its own shares and not yet quite a panic-driven sale, the possible trend of DATs selling their holdings is worth paying attention to.
• Additionally, another segment of the market, Spot ETFs, which we’ve previously mentioned have been a strong driver of the rally in BTC and ETH have continued to see cumulative outflows since mid-October. 
• While yesterday Spot Bitcoin ETFs purchased $239.9M of bitcoins, since Oct 10, 2025, outflows have amounted to $2.2B. For ETH ETFs, which also saw a modest $12.5M inflow yesterday, total outflows since the Oct 10 liquidation have summed to over $1B. 

• Positioning in options markets however is perhaps the best reflection of the current bearish sentiment in crypto. 
• At-the-money implied volatility for BTC and ETH options of all maturities, though particularly for shorter-dated contracts, remains elevated. That elevated vol is not however a reflection of trader’s pricing in a relief rally or a bounce from the low $100K zone. 
• Instead, it indicates heightened demand for short-term protection against a further crash back below $100K, as put-call skew for 7-day BTC and ETH options trade at -6% and -8% respectively. 

• Heightened volatility was not just apparent yesterday in crypto markets however. US equities dipped more than 1% (S&P 500 fell 1.12% and Nasdaq 100 dropped 1.91%) yesterday, amid a private jobs report that showed a cooling labour market. 
• According to the outplacement firm Challenger Gray & Christmas, US companies announced the most job cuts for any October since 2003. In total, according to the firm, US companies announced 153,074 job cuts last month with year-to-date job cuts at their highest level since 2020.
• The report highlighted that the 2003 October layoffs were due to “large announcements in Retail due to acquisitions and in Telecommunication as cell phones gained wide adoption”. The October 2025 layoffs were led by technology also, but this time due to AI: “Technology continues to lead in private-sector job cuts as companies restructure amid AI integration, slower demand, and efficiency pressures.”

• It marked the second time in three days that US equities sold off, and highlighted the importance of private sources of data amidst the federal government shutdown. Earlier this week equities rallied on a private-sector payrolls report from the ADP. 

• Cleveland Federal Reserve Bank President Beth Hammack said on Thursday that she remains “concerned about high inflation” and believes “policy should be leaning against it”. 
• Hammack said “To me, comparing the size and persistence of our mandate misses and the risks, inflation is the more pressing concern”. 
• By her estimates, “I see inflation misses starting 2026 around 1 percentage point, which will take two to three years to resolve. If this happens, it would mean that inflation exceeded our 2 percent objective for the better part of a decade.”

• Additionally, Chicago President Austan Goolsbee told CNBC yesterday that “If there are problems developing on the inflation side, it’s going to be a fair amount of time before we see that”, regarding the lack of inflation data due to the government shutdown. 
• That lack of data “makes me even more uneasy,” Golsbee said, particularly as there are less private-sector data sources for inflation compared to labour market data. 
• He also echoed a message touted by Chair Powell in the October FOMC meeting — “I have some concerns, and I lean more to the, ‘When it’s foggy, let’s just be a little careful and slow down’”. 

• According to on chain data, Tether has purchased a further 961 Bitcoin, valued at approximately $97.34M. This adds to their recent September 30 purchase of 8,889 Bitcoin worth nearly $1B, bringing its total holdings to 87,290 Bitcoin valued at approximately $8.84B.

• Google has partnered with Kalshi Inc. and Polymarket to integrate prediction market data into its finance platform. This update will allow users to type natural-language queries and view live market probabilities along with historical trend data directly in Google Finance.

• Tenerife’s Institute of Technology and Renewable Energy (ITER) is hoping to sell 97 Bitcoin, bought in 2012 for €10,000 and now worth around €8.5M, to fund quantum technology research. ITER have previously attempted to sell BTC and have been met with regulatory and logistical challenges.

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