Crypto Markets Today: Bitcoin Rises, but Risk Appetite Remains Weak

The crypto market began the week as it ended the last: little changed in the past 24 hours as sentiment slumped back into the "extreme fear" zone.

Bitcoin BTC$87,169.78 now trades at $89,900, rising from Sunday's low of $88,000 and continuing to show weakness after reaching a high of $94,300 after the Federal Reserve's 25 basis-point interest-rate cut last week.

Volatility across the altcoin market is also waning with a handful of tokens including ether ETH$2,951.71 and TRX$0.2799 rising by less than 2% over the past 24 hours, while more than half of the top 100 tokens are in the red over the same period.

The CoinDesk 20 (CD20) Index is up by 0.16% on Monday while the CoinDesk 80 (CD80), which is a broader basket of crypto tokens, is down by 0.77%, underscoring the weakness of the smaller, risker altcoins.

Derivatives positioning

• DOGE, HYPE, SOL and ETH saw an increase in notional open interest (OI) over 24 hours while ZEC, BNB, AAVE, TRX and smaller coins witnessed capital outflows. OI in BTC is largely unchanged.
• OI in DOGE futures rose to 10.80 billion DOGE, the highest since Nov. 20. alongside moderately positive funding rates. The combination points to bullish positioning.
• As XRP threatens to dip below the long-held $2 support, OI has increased over 3%, with funding rates hovering close to zero/neutral. A breakdown could invite bears to take short bets, pushing funding rates into negative.
• Speaking of funding rates, XLM, MNT and HBAR are seeing negative figures, pointing to dominance of shorts.
• On Deribit, the BTC put skew has moderated at the front-end. In ETH's case, front-end puts are pricier than BTC, implying a net bearish bias on ETH/BTC pair.
• Block flows featured BTC calendar spreads and ETH put spreads.

Token talk

• The altcoin market underperformed bitcoin, ether ETH$2,951.71 and TRX$0.2799 over the past 24 hours with several tokens, including AERO, TAO, ZEC and SKY, falling as much as 4.5%.
• One sector that performed well, or at least better than its counterparts, was liquid staking tokens: Lido (LDO) and ETHFI$0.7895 both posted gains of around 2%.
• The ETHFI rise can be attributed to announcement that it is dishing out 10% in ETH cashback for those using the ether.fi card in a campaign it is calling "Ethmas."
• CoinMarketCap's "altcoin season" indicator is at 19/100, slightly higher than last week's low of 16/100, but a far cry from September's high of 78/100.
• This shows that investors still prefer the safety and relative consistency of bitcoin and other larger market cap tokens as opposed to more speculative assets that are associated with volatility.
• CoinGlass data shows that bitcoin dominance has steadily risen in recent months, increasing from 56.8% in September to 58.4%. This shift has occurred alongside the release of thousands of new tokens, which historically has taken market share away from BTC.