"Year-end options market cautious stance… virtual asset volatility likely to remain low"

The virtual asset (cryptocurrency) options market has entered a clear watchful phase ahead of the year-end, according to an analysis.

On the 23rd, crypto options analytics firm GrixdotLive said that around the Christmas holiday period many institutional and retail investors in the U.S. and Europe are reducing market participation, slowing overall trading activity. U.S. markets close on Christmas Eve and Christmas Day, and this atmosphere is said to typically continue until after the New Year.

In particular, the coming 26th is the annual option settlement day, a point at which more than half of all option positions are approaching expiration.

Amid this trend, volatility indicators have noticeably declined. GrixdotLive reported, "Since last week, implied volatility across major expiry segments has generally started to fall, and the share of large trades has rather increased."

Over the past month, implied volatility for major expiry options of Bitcoin (BTC) has fallen by more than 5% overall, and by over 10% in the short- and mid-term segments. The decline in Ethereum (ETH) volatility was said to be even greater.

GrixdotLive assessed, "Market participants' expectations have generally lowered, and it is highly likely that low volatility without a strong direction will continue for about the next two weeks." It added, "As with the outlook presented earlier this month, there is a high probability of a gradual decline or sideways movement through the end of the year."