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

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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.

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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

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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

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How to Complete Network3 Tasks for Bybit Web3 Airdrop Arcade

Bybit Learn

DeFi

IDEX is a perpetual futures DEX with off-chain trading and on-chain transaction settlement. Learn more about how it works in this article.

) offer unique benefits for traders, but most projects fail to take advantage of the benefits of both options. A DEX, for example, has minimal regulatory oversight and lower 

. In addition, users maintain control over their digital assets. CEXs, however, are often easier to use, and transactions may be processed more quickly. IDEX is a hybrid network that offers key advantages of both centralized and decentralized exchanges for users to benefit.

IDEX stands apart from other perpetual futures DEXs with its hybrid structure. Because it runs on 

, IDEX’s trading fees are ultra low. IDEX offers instant trade execution with low 

. Failed transactions are guaranteed not to be an issue. In addition, all trades are settled on-chain so that users have full control of their assets and don’t need to expose their 

 to access external trading outlets. In addition, the network’s 

 integrations give users greater access to a wider range of services and products.

IDEX is the brainchild of CEO Alex Wearn and COO Philip Wearn, and was 

 as a premier DEX for all traders. Its team also includes approximately 30 other talented professionals. In 2018, the IDEX network secured 

) procedures in order to comply with anti-money laundering (

) regulations and sanctions. This important change allowed IDEX to decentralize fund custody and gave users access to newer 

 before they were listed on major exchanges. In August 2020, IDEX received 

 from Borderless Capital, Collider, Gnosis and G1 Ventures. 

IDEX’s founders and developers have worked tirelessly to establish and perfect a high-performance decentralized exchange. They’ve focused on giving users the ability to execute trades efficiently, without concern for failed transactions. At the same time, their attention has centered on incorporating the security and transparency of a DEX. Because of their efforts, IDEX’s developers have created a system to decentralize fund custody, optimize latency, execute trades immediately and settle transactions without 

) but stands apart from other DEXs due to its use of hybrid liquidity. This ensures that failed transactions aren’t problematic, while also facilitating fast transactions and lower fees. BNB Chain, 

As is true of many other decentralized exchanges, IDEX connects users to hundreds of different cryptocurrencies, while charging minimal trading fees.

IDEX’s high-performance exchange uses an AMM that secures real-time trades with liquidity pools. Specifically, users can deposit their preferred token pairs using 

. The order requests then draw from liquidity pools for instant trade execution. In addition to its use of hybrid liquidity and smart contracts, IDEX supports the use of advanced trading strategies.

As with trades on other DEXs, IDEX trades are executed with funds from 

. However, they can also be executed using traditional order books. Because IDEX employs order books and liquidity pools, failed transactions are rendered moot and fees are reduced. IDEX fully supports limit order liquidity with the lowest fees, which in turn supports instant trade execution.

A transaction fee is charged to users to complete trades on smart contracts, and the fees related to trades, withdrawals and other sub-actions are taken from the account balance.

IDEX stands out from other decentralized exchanges with its hybrid structure to support a superior trading experience. In addition, several other features enable IDEX users to generate income from their participation with the network. 

 to the IDEX liquidity pools with the incentive of LP tokens. There are two farming options available. The first is a single reward farm, which enables users to stake their tokens over a range of reward multipliers to suit their goals. The second is a dual reward farm, which pays market maker rewards in multiple tokens.

On IDEX, users can generate passive income by 

 their IDEX tokens. Specifically, they can operate their own staking node or delegate their tokens to another node. The staking reward is 50% of the trading fees collected. Stakers receive their rewards in the form of 

 by staking 10,000 IDEX or more. With this feature, IDEX employs order books in real time, allowing researchers, traders and market makers to receive advanced API data.

 is an independent, open-source product that simplifies the process of operating a trading bot and taking advantage of AMM opportunities. It’s well-suited for those of all skill levels. Hummingbot can be operated on both a secondary exchange and IDEX using an 

 trading strategy to optimize profitability from trades.

XCHAIN is a Layer 2 system that works on Polygon’s zkEVM, a zero-knowledge scaling solution. XCHAIN offers the full security of Ethereum and uses 

, so it has faster transaction processing times and lower fees and is capital-efficient.

When IDEX launched in 2017, its purpose was to elevate the DEX user experience by integrating centralized exchange benefits. In 2023, 

 was released to further advance the developers’ efforts to deliver the benefits of both CEXs and DEXs. 

IDEX is the native token of the IDEX network. The token can be 

 on dual rewards farms wher they pay staking rewards in multiple tokens. The total supply of 

 is one billion, and the circulating supply is roughly 761 million.

As of Aug 17, 2023, the IDEX token price is $0.047, down 4.2% off of the 24-hour high. The 24-hour trading volume is approximately $4.5 million, an increase of 4.2% over the last 24 hours. IDEX’s market cap is $36.3 million. The all-time high (ATH) IDEX token price of $0.937763 on Sep 8, 2021 was 94.91% higher than today’s price, while the ATL of $0.00563813 on Mar 23, 2020 was 746.18% lower than today’s price.

, IDEX’s price will decrease to $0.013 by the end of 2023, but will increase to $0.085 by 2025, $0.13 in 2027 and $0.26 in 2030. Looking farther ahead, they project IDEX’s price at $0.40 in 2032 and $0.63 in 2034.

 have an even more positive long-term outlook, forecasting IDEX at $0.065 by the end of 2023, $0.14 in 2025, $0.29 in 2027, $0.92 in 2030 and $1.90 in 2032.

Looking to trade IDEX tokens? Bybit now offers IDEXUSDT Perpetual Contracts for trading. To get started, click on the 

) and fund your new account with cryptocurrency. Then, navigate to the 

All cryptocurrency investments should be made cautiously and after individual 

. While there may be considerable upside to a long-term hold strategy for IDEX tokens, price fluctuations over short periods of time could be substantial, as is true with any cryptocurrency. However, while holding your tokens, you can also earn market maker rewards or staking rewards on IDEX.

IDEX offers an exceptional trading experience with the benefits of both decentralized and centralized exchanges. In addition, users can take advantage of referral rewards, market maker rewards and staking rewards. As a result, this network is poised for growth, and it could elevate your trading experience in exciting ways.

IDEX (IDEX): A Hybrid Liquidity DEX With Gas-Free Trading

Grab Up to 5,000 USDT in Rewards

Grab Up to 5,000 USDT in Rewards