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

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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 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.

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

DeFi

The Maverick Protocol is a DeFi platform designed to increase liquidity and improve capital efficiency in the DeFi space through its innovative Dynamic Distribution AMM.

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 to bring diverse products into the cryptocurrency market. At the heart of DeFi is the 

 (AMM), which allows permissionless and immediate trading without traditional intermediaries.

Since the introduction of AMMs into DeFi, various projects have been developed to refine the concept and address the challenges of using such a model. However, DeFi still fundamentally lacks a project that provides increased capital efficiency, regardless of market conditions.

Maverick Protocol has created a revolutionary AMM ecosystem that fills this void with an infrastructure that lets DeFi enthusiasts gain the most value from their capital, irrespective of price movement.

Let’s learn more about Maverick’s next-level AMM structure.

 designed to implement trades and negotiate prices without the need for a centralized order book. AMMs are the cornerstone of DeFi. They’re fully automated, and are always available to facilitate trades in 

In order to function, AMMs need asset deposits supplied by liquidity providers (LPs) who earn from users' transaction fees. These assets are deposited into AMM liquidity pools in the DEX, which then issue the liquidity provider with 

One of the earliest platforms to implement AMMs in the DeFi space was 

 AMM in their first version. From this algorithm, many other AMM variations, such as 

However, this model had challenges in terms of 

 introduced an AMM to counter these challenges, which allowed LPs to concentrate liquidity by staking a range of prices. This updated AMM significantly improved capital efficiency, but also introduced an increased risk of 

for liquidity providers when the price moved out of range.

Despite the progression in AMMs, most are designed to provide value when the market moves sideways. As such, many liquidity providers stay away from DeFi, which thins the market and leads to poor pricing.

The Maverick Protocol is a DeFi platform designed to increase liquidity and improve capital efficiency in the DeFi space through its innovative Dynamic Distribution AMM, which enables liquidity providers to both stake a price range and define how that liquidity should move as the price fluctuates.

Maverick’s AMM is built on the concept of 

, which automates the way liquidity is concentrated by granting LPs more freedom to choose how their capital is utilized when there’s price movement.

By automating liquidity strategies through the 

, Maverick gives LPs better control over their capital — which boosts capital efficiency, resulting in more liquidity in the DeFi market. With enhanced liquidity in the market, traders benefit from better pricing, while LPs earn more from the fees generated.

Maverick launched its revolutionary AMM on the 

 on Mar 8, 2023, and quickly rose in DEX rankings in terms of trading volume. In its second phase, introduced a month later, Maverick brought DeFi its 

 liquidity incentivization product, which attracted liquidity staking platforms such as 

Maverick will soon launch its utility token, MAV.

Based on remedying the various limitations in current AMMs, Maverick has developed an infrastructure to offer the most liquid markets to DeFi users. Uniswap V3’s concentrated liquidity AMM restricts LPs to the sideways movement of the market, which can expose them to impermanent loss, should the price move out of the specified range.

However, Maverick has introduced the Directional LPing concept, which allows LPs to move their liquidity in four modes, benefiting both traders and LPs. Concentrated liquidity AMMs such as Uniswap’s aren’t always capital-efficient, since an LP’s capital is only valuable if it remains within a given liquidity pool range. The LP’s capital becomes less effective once the token's price moves away from the designated range. To remain capital-efficient, LPs will have to move their liquidity to a new range, which can be time-consuming and also incurs gas fees.

Maverick offers a solution using automated smart contracts that reconcentrate liquidity, allowing the capital to generate fees by moving with the price. Since smart contracts automate the liquidity reconcentration, LPs don’t need to actively monitor their liquidity positions. All they need to do is select the mode, based on the price direction in which they believe the token will move.

Another benefit is that Maverick allows LPs to customize their LP distribution strategy, unlike other AMMs in which the AMM fixes a range for the LP. As such, Maverick’s fee-reward ratio better balances the risk of impermanent loss. 

Key features on the Maverick Protocol include the following.

To increase capital efficiency, liquidity providers on Maverick can choose to stake their assets based on four pool modes, which ensures that their capital never stagnates.

These pools use a pricing mechanism known as 

 (TWAP) to regulate liquidity. The TWAP used in Maverick’s AMM is similar to that used in 

, though their implementation and objectives differ slightly. 

In the Maverick Protocol, TWAP tracks and manages liquidity within a pool by continuously registering the pool's price at the end of each asset swap. After the first swap, the TWAP is updated, and the contract checks to see if any liquidity needs to be moved. Shifting of liquidity in any of the four modes is done automatically by a smart contract, which means that the LP doesn’t incur any gas fees.

In this liquidity strategy, the LP’s capital shifts when the price of a token increases and moves to the right of a given price range. An LP activates this mode when they’re bullish on a token.

This mode is the reverse of Mode Right, and shifts liquidity when the price of an asset decreases.

Mode Both follows the direction in which the market moves by reconcentrating liquidity to a range near the price. Although Mode Both offers the potential for higher returns by maximizing fee capture, it also presents a greater risk of impermanent loss, since LPs are exposed to price movements in both directions.

By choosing this mode, an LP opts to use a strategy similar to Uniswap’s concentrated liquidity AMM. It’s the least capital-efficient of the four modes.

Maverick Protocol’s Boosted Positions offer liquidity providers the opportunity to earn additional rewards by staking their liquidity in specific pools. These positions provide greater control and flexibility for LPs.

Once an LP opens a Boosted Position, other LPs can add their liquidity to the pool, and the additional token rewards earned on top of trading fees are then shared among all contributing LPs. Such incentives are particularly attractive to projects looking to bootstrap liquidity and attract liquidity providers.

MAV is the utility token for Maverick Protocol. Its main uses are staking, boosting liquidity and giving holders voting rights. To participate in voting, users can stake their MAV tokens to receive 

, which act as the platform’s governance tokens.

 that will be used to reward those who participated in the growth of the platform’s ecosystem. Over 30 million MAV tokens have been allocated to the incentivization airdrop, which represents 1.5% of MAV’s total token supply.

There will also be a further airdrop, to incentivize those who stake their MAV tokens, so they can receive veMAV governance tokens.

Full tokenomics of MAV are still to be released.

The platform has also cautioned users from claiming the airdrop from scam websites with malicious token contracts. The details of the airdrop allocation are shown below.

Maverick’s innovative AMM model could provide a much-needed paradigm shift in liquidity provision. Its Dynamic Distribution AMM provides LPs with higher capital efficiency, while reducing the risk of impermanent loss by giving users better control over their capital.

Having quickly climbed the charts on Ethereum’s DEX rankings, Maverick Protocol is changing the AMM game by significantly improving liquidity in the market through better pricing mechanisms for traders and more fees for LPs. Indeed, the project will make an impact on how AMMs work in decentralized finance.

Maverick Protocol (MAV): The Dynamic Future of AMM

Grab Up to 5,000 USDT in Rewards

Grab Up to 5,000 USDT in Rewards