Bitcoin experiences a pause as a risk-averse sentiment boosts gold, while alternative cryptocurrencies strive for a breakout: Current Trends in Crypto Markets.

Bitcoin and ether remained relatively stable as U.S. equity futures softened, prompting investors to adopt a risk-averse stance. A few altcoins deviated from this pattern due to limited liquidity.

Gold reaches all-time highs as bitcoin stagnates (Jingming Pan/Unsplash)

Key takeaways:

• Bitcoin remained around $88,900 while ether dipped 1%, with Nasdaq 100 and S&P 500 index futures declining.
• Gold and silver achieved new highs, indicating a defensive stance connected to geopolitical anxieties.
• Some altcoins exhibited signs of upward movement — ZRO surged on upgrade optimism — although low liquidity may enhance price fluctuations.

The cryptocurrency market experienced minimal movement on Friday, with bitcoin BTC$89,523.76 exchanging at $88,950 and ether ETH$2,958.14 dropping roughly 1% since midnight UTC to $2,920.

This trend aligns with U.S. equities, where Nasdaq 100 index futures and S&P 500 index futures fell by 0.4% and 0.25%, respectively, during the same timeframe.

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Precious metals gold and silver continued their ascent to unprecedented highs this week as investors sought safe-haven assets, reflecting a risk-averse sentiment in the markets.

This sentiment is linked to the initial trilateral discussions among Ukraine, Russia, and the U.S. on Friday, with investors appearing skeptical about any potential resolution to the ongoing conflict.

The altcoin market showed slight resilience despite the overall downturn. LayerZero’s ZRO token has increased by 12% in the past 24 hours as traders look forward to a significant upgrade scheduled for early February, while TRX and DASH both gained approximately 3%.

Derivatives positioning

• More than $200 million in crypto futures positions were liquidated within 24 hours, predominantly affecting long positions (bullish bets). This trend has persisted since the start of the week as the price decline caught bulls by surprise.
• Bitcoin’s annualized 30-day implied volatility index, BVIV, has retracted to 40%, reversing the brief spike to 44% observed on Tuesday. The decline indicates sustained investor interest in selling volatility through strategies like covered calls.
• Ether is the sole top 10 cryptocurrency to experience a minor increase in futures open interest (OI) over the past 24 hours. Other cryptocurrencies, including BTC, ETH, XRP, and SOL, witnessed capital outflows.
• The OI-adjusted cumulative volume delta indicator reflects net buying in TRX, ZEC, and BCH markets. In contrast, other markets, including BTC, faced net selling.
• On Deribit, short- and near-term ether ETH$2,958.14 put options are more expensive than BTC’s, indicating that traders are more pessimistic about Ethereum’s native token.
• Block flows showed a preference for BTC straddles, a bet on volatility, and ETH put spreads.

Token discussion

• The “altcoin season” indicator rose to 29/100 from 24/100 over the past week as traders sought to extract gains from an otherwise subdued market.
• The bitcoin-centric CoinDesk 20 (CD20) Index decreased by around 0.6% since midnight UTC, while the memecoin, DeFi, and metaverse metrics are all performing positively.
• A persistent lack of liquidity continues to impact the altcoin market, with a 2% market depth for an asset like TON$1.5329, for instance, positioned between $580,000 and $700,000. This signifies that an order within that range would be necessary to shift the $3.7 billion market by 2%.
• However, it’s important to highlight that if the broader market begins to rise, altcoin gains could be magnified due to a scarcity of sell orders in the order book.
• The metaverse tokens remain the top-performing sector of the year, with the CoinDesk Metaverse Select Index (MTVS) demonstrating a 50% increase since January 1, propelled by strong performances from axie infinity (AXS) and SAND$0.1531.