Jan 6, 2025: Our weekly Institutional Insights explores the latest market developments — market performance, industry news, exchange-traded fund (ETF) flows, trending topics, upcoming events and token unlocks — to help you supercharge your crypto trading.

Weekly Highlight — Markets Snap Five-Day Loss Streak 

Investors are now seizing the opportunity to buy the dip in U.S. stocks after a five-day decline that erased over $1 trillion in market value. Wall Street has broken its longest losing streak since April, with the Nasdaq-100 rebounding 1.7% and the S&P 500 rising 1.3% on Friday, January 3. These gains slightly offset the week's sell-off, which had continued into the new year following a tough December.

Despite concerns about slowing earnings growth among tech giants like the Magnificent Seven, traders remain optimistic, especially regarding AI leader NVIDIA Corporation. The market believes that, as long as retail investors keep investing in AI, the associated stock market boom is expected to persist. 

Stocks reached their session highs in the afternoon after Mike Johnson was reelected as speaker of the U.S. House of Representatives, indicating potential support for a business-friendly agenda. Meanwhile, bond yields rose, with the 10-year hitting 4.6% following comments from Richmond Fed President Tom Barkin about maintaining restrictive rates. U.S. manufacturing showed modest growth, with new orders at their highest since early last year, while investors assessed economic strength against the possibility of slower interest-rate cuts.

Weekly Crypto Highlight — AI Agent Spring Coming

Many investors are eagerly anticipating an Alt Season, a period when altcoins typically surge in value. However, current market dynamics suggest we may not see a widespread altcoin rally. The sheer number of tokens, combined with limited liquidity, has led to what's known as altcoin dispersion, making it crucial to select the right sectors and tokens.

, which are thriving even as the broader market declines. This nascent sector is experiencing rapid advancements, and its associated tokens face less pressure from venture capital unlocks. Many of its top protocols lack centralized exchange listings, indicating more buyers may enter the market.

Those investors who missed previous opportunities, such as the DeFi summer of 2020 and the Alt Layer 1 trade, now have another chance. Instead of targeting individual AI agents, the best risk/reward strategy lies in investing in infrastructure plays, which serve as the foundational tools for the sector.

The leading AI agent player is Virtuals Protocol, a platform for launching tokenized AI agents on the Base network. By purchasing tokens like Luna by Virtuals (LUNA) and VaderAI (VADER), users gain governance rights over specific agents, which allows them to both influence development and share in profits. 

Recently, daily protocol fee revenues dropped significantly in mid-December 2024 as activity slowed for the holidays. However, speculation around agent-associated tokens surged as the new year approached. Currently, Virtuals Protocol generates over $1 million in daily fees, though this is 50% less than figures for early December. Despite these challenges, the VIRTUAL token has more than doubled in value, reaching a market capitalization of $4.6 billion.

Other highlighted opportunities include Zerebro, which is pivoting to a full-stack framework for AI agents; ARC, with its Rust-based framework; and 

 (GRIFFAIN), a natural language on-chain search tool. These projects are well-positioned for future growth in the evolving landscape of AI technology.

 as we delve into leading AI agent tokens and the past week’s market movements. 

Advanced

Bybit Institutional_Weekly Poster.png

Weekly Institutional Insights: Market Snaps Five-Day Loss Streak; AI Agent Spring Coming

Our weekly crypto derivatives analytics report delves into macro events, the current state of crypto and trading signals from spot trading volume, and futures, options and perpetual contracts.

December's end-of-year options expiration brought an unexpected drop as realized volatility fell to the lowest levels of the month. Perpetual swap open interest remained stable, indicating these markets weren't heavily used for hedging against expired options, likely contributing to the muted volatility. 

While most expired open interest in Bitcoin (BTC) and Ethereum (ETH) hasn't been reinvested, the balance of calls and puts remains consistent. Notably, ETH options are pricing in higher implied volatility as compared to BTC, particularly for shorter expirations, leading to a flat term structure for ETH, while BTC is offering cheaper options exposure.

In the perpetual markets, low volatility and minimal spot movements have led funding rates for nearly all tokens to mirror broader market sentiment throughout the holiday season. On the options side, BTC's term structure is noticeably lower and steeper than ETH's, with realized volatility now dipping below implied volatility levels, highlighting an intriguing shift in market dynamics.

Please check out the report’s highlights.

Open Interest Solid Amid Year-End Options Expiration

Although open interest for both BTC and ETH perpetual swaps hasn’t returned to early December 2024 highs, it remained robust throughout the significant end-of-year options expiration event. This suggests that these markets weren’t heavily utilized to 

 of the expiring options contracts, likely contributing to the lack of volatility observed during this period. Instead, trading volumes have dipped noticeably during the winter holiday season, coinciding with a collapse in realized volatility back to December 2024’s lowest levels.

BTC Option Curve Remains Steep During Call-Put Parity

The expiration of December's end-of-year options didn’t trigger the anticipated surge in volatility; instead, realized volatility has plummeted to the lower end of its recent range. The implied volatility term structure remains steep compared to both its recent behavior and ETH's, with longer-dated implied volatility around 57%, and 1-week at-the-money options trading about five points lower. Much of the expired open interest hasn’t yet been rolled into new positions, maintaining a neutral balance between puts and calls. Consequently, BTC's options market positioning is relatively neutral, lacking the leverage it had at the start of December 2024.

Huge ETH Option Expiring Doesn’t Cause Volatility

A late December spike in realized volatility didn’t carry into the new year, with ETH’s spot price currently exhibiting volatility below that of short-tenor implied volatility. Interestingly, the implied volatility term structure has undergone a steepening and re-flattening over the past week, contrasting with BTC’s slightly steeper profile. This suggests that ETH’s options market is anticipating higher short-term volatility in spot price movements. 

Despite the significant expiration of options open interest at the end of December 2024, which didn’t lead to a rollover into later expirations, call options continue to dominate the market and have increased at the start of 2025.

block-scholes-x-bybit-report.jpeg

Bybit X Block Scholes Crypto Derivatives Analytics Report (Jan 2, 2025): BTC Options Continue to See Call-Put Parity, With Lower Short-Term Volatility Expected

Dive into FLock, a decentralized platform that revolutionizes the way AI models are developed, trained and deployed.

Artificial intelligence (AI) is poised to transform countless industries, but its development often raises questions about privacy, control and inclusivity. 

 is a unique decentralized platform that democratizes AI training, fine-tuning and inferencing. With its blockchain-powered infrastructure, FLock ensures transparency, security and community-driven decision-making, paving the way for AI models that align with established societal values. 

In this article, we’ll explore how FLock decentralizes AI training, its key features and its potential impact on developers, communities and users.

 platform that revolutionizes the way AI models are developed, trained and deployed. By leveraging blockchain technology and a novel approach called 

, FLock addresses critical issues in AI development, such as centralized control, lack of transparency and privacy concerns.

At its core, FLock’s mission is to democratize AI by enabling communities to participate directly in the creation and refinement of AI models. Through federated learning, FLock trains AI models across multiple decentralized devices or servers. This method ensures that data remains local, eliminating the need for raw data exchange while still enabling robust model training. By decentralizing the training process, FLock not only protects individual privacy, but also fosters a more inclusive ecosystem in which diverse contributors can collaborate.

What sets FLock apart is its integration of 

. This ensures that all contributions — whether data, compute power or feedback — are transparently recorded and fairly rewarded. Blockchain tech’s immutable ledger enhances trust among participants and safeguards the process against manipulation. Additionally, the platform’s on-chain incentive mechanisms encourage participation from a wide range of contributors, ensuring that rewards are distributed equitably.

Ultimately, FLock empowers communities to develop bespoke AI models tailored to their specific needs. By decentralizing the process and prioritizing transparency and collaboration, FLock breaks the monopoly of large corporations, creating an AI ecosystem that aligns with public ethics and societal values.

, an Oxford alumnus with a robust background in AI and blockchain technology. Sun, who serves as FLock's CEO, has an impressive career trajectory, having worked as the Director of AI for the Royal Bank of Canada and as an AI Research Fellow at Imperial College London. His vision for FLock stems from a deep understanding of both the technical and ethical challenges of AI development.

The founding team also includes other Oxford alumni, boasting over a decade of combined experience in AI research and the cryptocurrency industry. This team brings a collective blend of academic excellence and practical expertise that positions FLock to lead the decentralized AI movement.

FLock has successfully raised $11 million in funding across two rounds, reflecting strong investor confidence in its vision. In May 2024, FLock secured a $6 million seed round co-led by Lightspeed Faction and Tagus Capital, with additional backing from Digital Currency Group (DCG), Volt Capital, OKX Ventures and Inception Capital.

Later, in December 2024, FLock announced a $3 million successful funding round led by DCG and joined by prominent names like Animoca Brands, Fenbushi Capital, GnosisVC and GSR. These investments are being channelled into enhancing the platform’s testnet and federated learning client, accelerating FLock’s mission of enabling secure, collaborative AI development.

With this funding and over 1,500 nodes contributing from platforms like Numerai and Kaggle, FLock is rapidly scaling its impact on decentralized AI training.

FLock AI revolutionizes AI development through its decentralized training framework. This approach allows participants to contribute to AI model training without ever sharing their personal data. Instead, models are trained locally across devices using federated learning, which ensures that data remains with its owners while still enhancing the accuracy of the model overall. 

FLock’s reward system is designed to incentivize active participation. Contributors who provide data, computational power and/or feedback are compensated with FLOCK tokens, ensuring a fair distribution of rewards. 

FLock empowers its community through a robust governance framework. Decisions regarding AI model development, deployment and ethical considerations are driven by the community, ensuring alignment with established societal values. Through blockchain-based voting mechanisms, contributors can influence the direction of AI projects, fostering transparency and public accountability. 

FLock’s modular architecture allows contributors to participate in specific aspects of AI model development. Whether providing raw data or computational power or even refining algorithms, the platform enables a collaborative and scalable development process. 

At the core of FLock’s philosophy is its commitment to privacy and security. By leveraging blockchain technology, the platform ensures that no single entity controls the AI development process. Data remains local and protected by cryptographic measures, while the immutability of blockchain guarantees transparency in every transaction and model update. 

 begins with a blockchain and an AI layer.

The blockchain layer underpins FLock’s incentivization and security mechanisms.

The AI layer facilitates model training, refinement and deployment, leveraging both centralized and federated approaches.

Let’s have a look at the supply and demand for the FLOCK token.

FLock adopts a 1:2 ratio model between team/investors (33.3%) and community (66.7%), prioritizing community-driven growth and ecosystem expansion. The majority of tokens are allocated to incentivize user participation and long-term ecosystem success.

FLock aims to improve the future of AI development by decentralizing the training process and ensuring transparency, privacy and inclusivity. By leveraging blockchain and federated learning, FLock empowers communities to contribute to AI creation without compromising on privacy. Its innovative reward system and community-driven governance foster a fair and collaborative ecosystem. 

With significant backing and a growing network of contributors, FLock is positioning itself as a leader in decentralized AI, offering a more ethical and secure alternative to traditional AI development models. As it continues to scale, FLock is set to transform the way AI models are built and deployed.

 — and earn a share of a 10 million FLOCK prize pool. For more details, visit 

Intermediate

flock.png

FLock AI: Decentralized AI Training

In this tutorial, we’ll explore how you can complete a series of tasks in Network3 for Bybit Web3 Airdrop Arcade.

Task 1: Register for a Network3 Account and Connect Your Bybit Wallet 

: Navigate to the campaign page and click on the 

task. Click on the task, and Galxe will ask to redirect you to the Network3 register page.

: Register for a Network3 account using your email address. You may indicate a 

Task 2: Download the Network3 App and Run a Node for One Hour

 and choose your operating system to download the Network3 app.

 or powerbutton, depending upon which operating system you’re using. For ease of reference, we’ve used macOS and iOS as examples below.

: Keep running the node until the timer reaches 

Beginner

network3 tutorial.png

How to Complete Network3 Tasks for Bybit Web3 Airdrop Arcade

Bitcoin

Bitcoin has a historical record for its volatility. Besides asking when to buy a BTC, a great question to ask is when to sell and take profit. Learn more. 

AUG23_R56_Trendjacking_Deciphering_the_Right_Time_Should_I_Sell_My_Bitcoin_.png

Bitcoin is one of the most popular and volatile cryptocurrencies in the world. It has experienced massive price swings, reaching record highs and lows in a matter of days or even hours. Many investors and traders are constantly wondering: Should I sell my Bitcoin? When is the best time to cash out and take profits? Or should I hold on for more gains?

This blog post explores the factors and strategies that can help you determine when to sell your Bitcoin, as well as the risks and opportunities involved and the right time to buy back Bitcoin after selling.

Bitcoin is a digital currency running on a decentralized network without intermediaries or central authorities. It was 

 by a person (or persons) using the pseudonym Satoshi Nakamoto. The technology that powers Bitcoin is the blockchain, a distributed ledger that verifies and records all transactions on the network.

, Bitcoin features several advantages, such as lower transaction fees, greater transparency, faster processing times and limited supply. However, it also has some drawbacks, including high volatility, security risks, technical complexity and regulatory uncertainty.

Volatility is a measure of risk and uncertainty in the market, and Bitcoin is known for its high volatility. Its price can change dramatically and quickly, making it difficult to predict its future movement. For example, in 2017, Bitcoin reached an 

 of nearly $20,000 in December, only to drop by more than 50% in January 2018. In 2020, it plunged by more than 60% in March, due to COVID-19, but then soared by more than 300% by the end of the year. In 2021, it hit a new record high of over $60,000 in April but crashed by more than 50% in May.

Supply and demand, media attention, investor sentiment, innovation, regulation, hacking and market manipulation are some factors that influence the volatility of Bitcoin, creating sudden spikes or dips.

There is no one-size-fits-all answer to when you should sell your Bitcoin. The decision is a function of your personal goals, risk tolerance and the current market situation. However, some factors can help you make strategic decisions based on your circumstances.

Your break-even point represents the minimum price at which you should sell your Bitcoin to avoid losing money. It’s the price you paid for the Bitcoin you own. Another way to calculate it is by dividing your total investment amount by the bitcoins you own. For instance, if you invested $10,000 to buy 0.5 BTC at $20,000 per BTC, your break-even point would be $20,000 per BTC.

To achieve the desired return on your Bitcoin investment, set a profit target for selling. Determine your target based on your 

 or expected value. For example, if you invested $10,000 in 0.5 BTC when the price was $20,000 per BTC, and want a 50% profit (a 1:2 risk-reward ratio), your target is $30,000 (that is, $10,000 × (1 + 0.5) / 0.5) per BTC. This figure represents your goal for the trade and helps guide your decisions.

This is the price at which you plan to sell your Bitcoin to limit losses if the price goes against you. It represents the maximum acceptable loss or risk for your trade. Your stop-loss level should be based on your risk tolerance or trading strategy. For instance, if you invested $10,000 to buy 0.5 BTC when the price was $20,000 per BTC and are willing to lose 10%, your stop-loss level would be $18,000 (that is, $10,000 × (1 − 0.1) / 0.5) per BTC. If the price falls below $18,000, you sell your Bitcoin and accept a loss of $1,000. However, you should set your stop-loss level carefully to avoid triggering it too frequently or too late. Adjust it as needed based on market conditions and your trading objectives.

, your tax jurisdiction, income bracket and holding period all play a role in determining the amount you owe. Rules and rates for cryptocurrency transactions vary by country. For example, for tax purposes the U.S. treats Bitcoin as property. Depending upon your income level and how long you’ve held your Bitcoin, tax rates can range from 

. It's best to seek guidance from a tax professional or use tax software to ensure you accurately report your transactions and meet your tax obligations.

The general outlook toward Bitcoin of those involved in the market is known as 

. It indicates the degree of assurance, hopefulness, anxiety or alarm in the market. Market sentiment can be affected by news events, social media trends, 

Market sentiment can be measured using sentiment analysis, trading volume, price action and the 

. Typically, when market sentiment is optimistic or bullish, it suggests that more people are purchasing or holding Bitcoin rather than selling or shorting it, and vice versa.

Deciding when to sell Bitcoin isn’t as simple as clicking a button. You need a plan and a strategy to execute your trade effectively and efficiently. Depending upon your goals and preferences and market conditions, there are different ways to sell your Bitcoin. Following are some of the most common strategies.

Selling Bitcoin can be profitable but also risky. You may face challenges and uncertainties when selling your Bitcoin.

When Is the Right Time to Buy Back Bitcoin?

If you sell your Bitcoin, it doesn't necessarily mean you're leaving the market for good. You may want to repurchase it for several reasons, such as capitalizing on a price drop, diversifying your investment portfolio or entering the market with a new strategy.

However, figuring out the right time to buy back your Bitcoin after selling it can be challenging. It isn't easy to give a definitive answer to this dilemma because it depends upon your individual parameters. Nonetheless, some indicators and factors can guide you in deciding when to repurchase Bitcoin. 

These determine the direction and momentum of price movements over time. You can use trend lines, support and resistance levels, moving averages and chart patterns to analyze price trends. Generally, when a price trend is upward or bullish, more people are buying or holding Bitcoin than selling or shorting it, and vice versa.

These are the mathematical calculations based on the price and volume data, that provide signals and insights about market conditions and behaviors. Some 

 include oscillators, momentum indicators, volume indicators and trend indicators. If the technical indicators are positive or bullish, the market is powerful and/or advantageous for purchasing or retaining Bitcoin. Conversely, if the indicators are bearish, the market is weaker and less favorable.

The information and events influencing market sentiment and expectations can help you keep track of market signals. These include news events, social media trends, expert opinions and market reports. Market signals that are positive or bullish suggest that the market feels confident or optimistic about purchasing or holding Bitcoin, and the opposite is also true.

Conclusion: Navigating the Bitcoin Market

Bitcoin is the world’s market-leading cryptocurrency, presenting investors and traders with both opportunities and challenges. Although selling Bitcoin can be a lucrative endeavor, it’s also a risky one that demands careful planning and execution. There is no straightforward or effortless solution to determining when you should sell your Bitcoin, as it hinges on several factors and circumstances that are specific to both you and the Bitcoin market.

Deciphering the Right Time: Should I Sell My Bitcoin?

Grab Up to 5,000 USDT in Rewards

Grab Up to 5,000 USDT in Rewards