Bitcoin and Ether Options Flows During the September 2022 Risk Selloff
Summary
This two-part flow commentary follows Bitcoin and Ether options during a late-September 2022 selloff in US risk assets and a subsequent rebound. It reports demand for BTC puts around nearby strikes, rising put skew, and implied volatility moving above short-term realized volatility. In Ether, traders were unwinding call spreads established before the Merge while also buying out-of-the-money puts. BTC calls traded in both directions, reflecting uncertainty over the next move.
The later update links put buying and higher volatility to concerns as BTC and equity markets tested lows. A Bank of England bond-purchase announcement coincided with a risk-asset rebound and renewed call buying, followed by further volatility buying through a strangle. The notes show how macro headlines can shift options positioning and skew, but they are qualitative, time-specific trade-flow observations. They do not verify trader motives or show that any position would have been profitable.
Key ideas
- BTC put buying and rising put skew accompanied concern about further market declines.
- ETH call spreads from before the Merge were unwound as traders also bought downside protection.
- Implied volatility rose above short-term realized volatility during parts of the selloff.
- A central-bank bond announcement coincided with a rebound and renewed BTC call buying.
- Flow notes capture a changing market snapshot and do not prove intent or strategy performance.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.