Cryptocurrency Market Faces Decline Amid Institutional Risk Aversion

According to PANews, the cryptocurrency market has experienced a downturn, with Bitcoin falling below a critical support level and briefly dropping under $90,000. This decline has erased the gains made earlier this year, marking a 27% decrease from its intraday peak on October 6. Technically, the 50-day moving average has crossed below the 200-day moving average, forming a 'death cross' and indicating a bearish trend in the medium term. On the financial front, cryptocurrency ETFs have seen a net outflow of $1.26 billion this month, reflecting a significant decrease in institutional risk appetite. In a tightening liquidity environment, demand for downside protection in the options market has increased, with short-term Put Implied Volatility (IV) rising and overall implied volatility following suit. This week, the options market's implied volatility has remained high, with Bitcoin's IV at 50.9% and Ethereum's IV at 75%. The 25-Delta Skew for both BTC and ETH has quickly turned negative with steep curves, indicating heightened market panic and defensive sentiment. The largest block trade involved buying BTC-281125-116000-C and selling BTC-211125-107000-C, totaling approximately 1,500 BTC with a premium expenditure of around $96,000, aiming to hedge against moderate declines while protecting against upside tail risks.