It’s been an eventful month across the global markets, where we witnessed the impact of coronavirus and the added chaos due to the Russia — Saudi oil price war. Cryptocurrency market was not spared from the global macro turmoil. Last week we observed massive sell down of BTC/USD from nearly $8,000 to a low of $3,850 in a short span of two days. Futures curve went from contango to deep backwardation (back to flat at the moment) on the back of panic selling and forced liquidations over no liquidity. 10-day realized volatility surged to 300%+ and remained at elevated level as spot continues to look for directions. Similar to players in the traditional markets, crypto traders with large leveraged positions using derivatives and borrowers with debt exposures based on BTC as collateral felt the most pain.
We observed quick dry-up of liquidity in both spot and derivatives markets along with the volatility last week, and liquidity continued to deteriorate into this week while BTC and ETH network congestions worsened the situation. Altcoins and smaller cap tokens have fallen victim to the drought in particular, as traders and investors scrambled to get capital on hand, when liquidity on the bid side went almost non-existent.
The market is in dire need for liquidity and we have seen rising interest through OTC trading as a result. Record high trading volume was reported in major pairs like BTC, ETH, stablecoins, and in a list of altcoins such as MKR, WAXP, NMR, IRIS.
We are monitoring the latest news and market movements closely, and continue to provide liquidity 24/7 across all major pairs, as well as most altcoins and smaller cap tokens. Stay safe and happy trading!
