Bybit X Block Scholes Option Volatility Report (February 2025): January 2025 Marks New Start for Crypto, Shaped by Macro and Policies

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Feb 13, 2025

3 min read

Key Highlights:

Our monthly report delves into insights from options volatility to inspire your next crypto move.

Influence of Macro Events on Crypto: In January 2025, Bitcoin (BTC) and Ethereum (ETH) faced significant weekend sell-offs driven by macroeconomic factors, including Donald Trump’s U.S. tariff policies, expectations of a strategic Bitcoin reserve and disruptions from AI competitors like DeepSeek.

BTC and ETH as Early Indicators: BTC and ETH reacted more quickly and sharply than traditional equities did to economic and geopolitical news as leading indicators for Monday market movements, similar to the earlier yen carry trade unwinding in August 2024.

Ethereum's Volatility Trends: Ethereum consistently underperformed Bitcoin during market dips in January 2025. However, the options markets reflected a lower implied volatility premium for ETH than expected, based on recent volatility comparisons.

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