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.

Advanced

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

Bybit launched the Bybit Merch Creative Challenge for university students worldwide, offering a $50,000 USDT prize pool.

The S&P 500 dropped 0.22% on Thursday, its fifth straight decline, with investors eyeing Friday’s economic updates. Coindesk Indices, an index measuring broader cryptocurrency market performance was up by 2.03%, with Bitcoin and Ether rising by 2.79% and 2.70%, respectively in the past 24 hours.

Today's top performer is XRP, which surged 1.9% following a rise in price driven by increased open interest and positive market sentiment.

Ripple (XRP), launched in August 2012, is a blockchain technology company focused on improving international payments with its cryptocurrency, XRP. XRP price surged due to increased open interest, a major XRP transfer, and market sentiment linked to Trump's inauguration. Bullish momentum is supported by high short liquidations, with key resistance levels to watch for further price movement.

Check Out the Latest Prices, Charts, and Data of 

 for university students worldwide, offering a $50,000 USDT prize pool. Participants can design exclusive Bybit merchandise, with submissions open until Jan. 15, 2025. Winners will be announced on Feb. 1, 2025, across four prize categories.

Yesterday, Bitcoin Spot ETFs recorded a total inflow of $84.8M, driven by $107.9M from non-GBTC funds, partially offset by a $23.1M outflow from GBTC.

, offering an airdrop for participants who complete tasks like swapping and bridging using the Mango wallet. Points earned through tasks determine airdrop rewards. Join via the Mango wallet and follow steps on the testnet dashboard.

2.png

Bybit Launches $50,000 Merch Design Challenge for University Students Worldwide

DeFi

Altitude is a composable blue-chip asset bridge designed to provide altcoins with secure and seamless omni-chain bridging 

Altitude-gALTD-stakers.png

In the wake of increased traction of the 

 movement, there’s an influx of blockchains entering the crypto space seeking to provide 

 products to users. Consequently, there’s a growing need for bridging solutions to help move assets between these blockchains in an efficient and cost-effective way.

However, there’s an increased risk of exploitation due to vulnerabilities and inefficiencies within the current cross-chain bridging solutions, especially the high-volume ones.

Furthermore, most of the current bridges are focused on stablecoins because of their stability and high liquidity. As such, a massive vacuum exists for an exclusive, altcoin-centric bridge focusing on blue-chip altcoins, for which demand is on the rise.

Altitude aims to fill this gap by providing a highly secure, in-demand and consumer-friendly altcoin-only bridge. 

 bridge designed to provide altcoins with secure and seamless omni-chain bridging through a user-friendly UI and highly transparent fee structure

Altitude is one of the first DApps to be built on 

. As such, it gets to leverage LayerZero’s technology and chain path infrastructure to add an extra layer of security for cross-chain transactions.

, which are currently in high demand and the cornerstone of DeFi. Unlike stablecoins, which are pegged to the value of a fiat currency or commodity, top-tier altcoins like Ethereum (

) have the potential to grow in value because their blockchains support 

, which offer more potential for innovation. Altcoins are also more decentralized than stablecoins, which are often issued by a centralized provider. This makes altcoins more inherently resilient to censorship and fraud.

Apart from altcoin bridging, Altitude also provides liquidity through single asset pools for chain paths. Altitude users can also stake their ALTD tokens to participate in platform governance (more on this below).

Security is paramount to the Altitude ecosystem. Apart from leveraging LayerZero’s security measures, Altitude also enhances security using the 

, which acts as a central focal point as transactions have to pass through the intermediary chain, Ethereum, to bridge to an alternative chain. Instead of using a unified 

 for connected chains, every chain path has its own liquidity pool. This autonomy between chains ensures a system-wide resilience against chain outages, safeguarding the entire network.

Furthermore, Altitude offers Secured Guaranteed Finality, which assures that funds from the source chain are transferred successfully to the destination chain. This provides increased security, as you’re guaranteed ownership of your digital assets at every step of the transaction.

As a DeFi protocol, Altitude offers the following products to users.

Moving Blue-Chip Assets Across the Bridge

Due to the challenges facing current bridging solutions that are often undermined by malicious players, Altitude has built a secure, fast and highly interoperable cross-chain bridge for DeFi users. Rather than relying on third-party routers like other bridges, Altitude has created the HUB, an Ethereum-based router connecting chain paths to the respective destination chains, enhancing security and stability.

Once you initiate a digital assets transfer on Altitude, the platform holds an equal amount from the executing chain until the transaction has been executed on its destination chain.

Once confirmed, the amount is deposited into the liquidity pool of the executing chain. Through the use of these two-step transactions, a balanced liquidity environment exists between the executing and target chains. When transferring non-ALTD tokens, a 0.05% fee is incurred. Additionally, if there’s imbalanced liquidity on either side, a rebalancing fee will be collected from the pool with higher liquidity to add liquidity to the lower side. The greater the imbalance, the higher the rebalancing fee will be.

Supported chains and assets on Altitude include Ethereum (ETH), Bitcoin (

To facilitate the transfer of digital assets, Altitude uses chain paths, which connect the same asset across different blockchains. Each side of the chain path has a liquidity pool that keeps track of liquidity on the respective chain. Altitude utilizes a single-asset liquidity pool for each chain, which cushions transactions against chain outages and 

Token holders can add liquidity to the liquidity pools where they receive 

, which they can use to redeem liquidity.

When you add liquidity to any of Altitude’s supported chains you receive LP tokens, which you can use to farm through 

You can stake your earnings into the ALTD staking pool to receive gALTD tokens representing your share in the pool.

Altitude’s protocol treasury usually performs weekly ATLD buybacks, which helps increase earnings for stakers. As a gALTD holder, you’re eligible to participate in Altitude’s governance.

ALTD is the native token for Altitude. It acts as a 

 that can be farmed by providing liquidity to the staking pools. Once you lock your tokens in a liquidity pool, you’ll receive LP tokens, and as a provider, you’re rewarded using ALTD. Once you receive ALTD from providing liquidity, you can stake it to receive gALTD, making you eligible to vote on governance matters pertaining to the Altitude protocol.

There’s a finite total supply of 100 million ALTD tokens. Of these, the allocation is as follows:

There’s a growing need for bridging solutions as more blockchains enter the crypto space. Altitude has strategically filled a gap in the bridging niche in the web3 sphere by providing an altcoin-only cross-chain bridge.

As such, Altitude will benefit from first-mover advantage since most available bridges focus on stablecoins. With an increasing demand for blue-chip altcoins, due to their interoperability and highly decentralized nature, Altitude will likely gain traction with many DeFi users.

Furthermore, Altitude is powered by LayerZero’s chain path technology, which enhances security on the platform. Altitude has been built to solve the challenges of security and speed facing current bridges. The platform also has a user-friendly interface and transparent fee system, making it a good pick for DeFi users, including novices in the space.

All of this makes Altitude a potentially viable investment, since the demand for fast, secure, transparent and innovative bridging solutions will continue to grow as the DeFi space develops.

While we maintain a positive outlook toward Altitude, our views should not be construed as financial advice. It’s crucial to 

, as investing in altcoins carries inherent risks due to their volatile nature.

There's an increasingly obvious need for fast and secure cross-chain crypto bridges, and Altitude has built an innovative and unique platform to meet this demand. By focusing on blue-chip assets, Altitude is positioned to help DeFi users embrace the use of altcoins in DApps.

Altitude’s innovative approach to enhancing security and speed on its platform by leveraging LayerZero’s technology makes it a favorable solution for asset transfers across chains. The platform has serious potential for growth as DeFi and web3 continue to pick up momentum.

Altitude (ALTD): Omni-Chain Bridges for Blue-Chip Crypto

Grab Up to 5,000 USDT in Rewards

Grab Up to 5,000 USDT in Rewards