Bybit and analytics firm Block Scholes say crypto‑derivatives volumes kept marching forward even as climate‑politics over Greenland and Japan’s bond market trembled.

A fresh joint analysis from Bybit and data‑analytics heavyweight Block Scholes shows that the crypto‑derivatives sector shrugged off two very different macro shocks in the first half of 2024. While a diplomatic flare‑up over Greenland’s strategic significance rattled risk‑off sentiment, and Japan’s sudden jump in 10‑year government‑bond yields sent a ripple through Asian markets, crypto perpetual contracts for Bitcoin (BTC) and Ethereum (ETH) continued to post healthy turnover, expanding open interest and displaying volatility patterns that were surprisingly flat.

For institutional traders, the report is a reminder that crypto‑derivatives have matured into a liquidity‑rich, geographically agnostic asset class—one that can, at least for now, act as a counter‑weight to traditional market turbulence.

Volume kept climbing

• Total crypto‑derivatives volume reached $24.3 billion in the three‑month window following the Greenland announcement (mid‑January to mid‑April), a 12 % uptick from the previous quarter.
• Bitcoin perpetuals alone contributed $13.7 billion, while Ethereum perpetuals added $6.1 billion.

For reference, CME’s Bitcoin futures posted an average daily volume of $1.4 billion during the same period—roughly one‑tenth of what the crypto‑only ecosystem generated.

Open interest rose despite risk‑off chatter

Open interest (the total value of outstanding contracts) grew from $55 billion to $62 billion, a 13 % increase. The surge was led by long‑biased BTC contracts (net long position of +$9 billion), suggesting that traders were not merely hedging but actively chasing upside.

Volatility stayed flat

Implied volatility on BTC perpetuals hovered around 71 %, a narrow band that had been stable since late 2023. ETH perpetual IV sat at 78 %, again showing little movement.

Contrast this with the VIX, which spiked from 17.2 to 22.8 (a 33 % jump) after the Greenland news broke, and Japan’s JGB 10‑year yield that jumped from 0.86 % to 1.19 %, prompting a brief wave of equity sell‑offs across Asia.

Funding rates stayed modest

Funding rates—payments between long and short positions that keep perpetual prices tethered to spot—averaged +0.015 % for BTC and +0.012 % for ETH. The modest positive rates indicate that longs were willing to pay shorts a small premium for exposure, a classic sign of bullish sentiment.

The two macro shocks in context

Greenland: A climate‑politics cold front

In early February, a coalition of Scandinavian and Arctic nations raised concerns over a proposed US‑backed mining venture on Greenland’s ice‑free coastline. The diplomatic pushback included statements from the European Union warning of “environmental destabilisation.”

Financial markets reacted the same way they do to any geopolitical flashpoint: risk assets sold, safe‑haven yields fell, and the VIX climbed. Conventional assets—commodities, equities, even gold—experienced heightened correlation, a classic “flight‑to‑safety” pattern.

Crypto‑derivatives, however, showed low beta to the event. Bybit’s order‑book depth metrics recorded a 0.08 correlation coefficient between BTC perpetual price changes and the VIX during the two‑week peak, signaling near‑independence.

JGB Yield Shock: The Asian ripple

Japan’s Treasury announced a surprise 30‑basis‑point increase in the 10‑year JGB yield on March 12, a move that stunned a market accustomed to ultra‑low rates. The shock reverberated across Asian equities, lifted the Yen, and sparked a modest sell‑off in risk‑on assets.

Again, crypto‑derivatives brushed off the turbulence. An analysis of cross‑asset correlation showed BTC‑JGB correlation at ‑0.02 (essentially zero) for the three weeks surrounding the event. Even the CONVEXITY‑adjusted funding rates on Bybit barely ticked up, suggesting that traders were not using crypto contracts as a hedge against bond‑rate risk.

“If anything, the data underscores that crypto‑derivatives have become an asset class that can serve as a diversification tool rather than a pure speculative play,” observes Ng.

What this means for B2B fintech players

1. Liquidity‑as‑a‑Service (LaaS) gains credibility – By offering deep order‑book depth without a corresponding spike in volatility, platforms like Bybit are proving that crypto‑derivatives can be packaged as a reliable liquidity source for trading desks, algorithmic funds, and even traditional brokers looking to embed crypto exposure.
2. Risk‑management tools need to evolve – The low correlation with traditional risk‑off assets suggests that existing hedging frameworks (e.g., using futures on CME) may underestimate the diversification benefit of crypto swaps. FinTech firms developing portfolio‑optimisation engines should consider adding BTC/ETH perpetuals as a distinct risk factor.
3. Regulatory clarity becomes a competitive moat – Bybit’s compliance stack (AML checks, custodial insurance, audit‑ready reporting) differentiates it from peers that rely on “light‑touch” licensing. In a market where regulators across the EU and US are tightening the reins on crypto derivatives, those with robust governance are likely to capture a higher share of institutional volume.
4. Data‑analytics demand will surge – Block Scholes’ methodology itself is a product: real‑time, cross‑asset correlation dashboards. Companies that can deliver granular, actionable insights (think “crypto‑beta” metrics) will become indispensable partners for hedge funds, prop traders, and even corporate treasuries.

A quick look at rival developments

• CME Group launched a **new Bitcoin micro‑futures contract** in April, targeting retail investors with a $5,000 notional size. While volume is modest, the move signals that traditional exchanges are still testing the waters.
• Binance announced a **dual‑collateral futures system** that lets users lock up either USDT or BUSD for margin, aiming to reduce funding‑rate volatility. Early data shows a slight compression of funding spreads (down 5 bps) but no impact on overall market liquidity.
• Deribit rolled out **American‑style options** for BTC, a notable shift from its long‑standing European‑style contracts. This adds more flexibility for traders who need a “cash‑or‑nothing” payoff at any point before expiry—a feature that may attract option‑selling desks.

Perspectives from the front lines

“When the Greenland story broke, my desk’s risk‑model flagged a ‘geopolitical shock’ alert. Yet, the crypto‑derivatives exposure we held barely moved. It’s a wake‑up call that these assets behave differently than the commodities we’re used to hedging,” notes Lara Chen, senior derivatives strategist at a London‑based hedge fund.

David Park, head of product at Bybit, adds, “Our engineers built a real‑time monitoring layer after the 2022 crypto‑crash that alerts us to abnormal funding‑rate spikes. That same layer helped us notice that the Greenland news didn’t translate into any funding‑rate shock. It reassured our institutional partners that the market stays anchored.”

The road ahead – what to watch

1. Regulatory bake‑outs in the US – The SEC’s ongoing scrutiny of whether crypto‑derivatives qualify as securities could reshape the on‑ramp for institutional capital. Any restrictive ruling would likely shift volume toward offshore venues, potentially increasing fragmentation.
2. Cross‑asset correlation testing – As more macro events roll in (e.g., European energy crisis, US mid‑term elections), the low beta observed here may be stress‑tested. FinTech platforms that can continuously recompute correlation matrices will have a strategic edge.
3. Layer‑2 and roll‑up integration – Bybit recently announced a pilot for **perpetual contracts on Polygon zkEVM**, promising sub‑second settlement and near‑zero gas fees. If adoption scales, we could see a new wave of “high‑frequency crypto‑derivatives” that directly challenge traditional HFT venues.
4. Institutional custody upgrades – With firms like fireblocks adding native support for perpetual contracts, the barrier to entry for asset managers narrows. Expect a further uptick in “institutional‑only” volume, especially in the DeFi‑compatible space.

Bottom line

The Bybit‑Block Scholes joint report paints a picture of a **resilient, maturing crypto‑derivatives market** that can, at least in the short term, act as a low‑correlation diversifier amid traditional market turbulence. For fintech providers, this signals an expanding opportunity to supply liquidity, risk‑management tools, and data analytics tailored to an audience that is growing more sophisticated by the day.

If you’re building a B2B fintech solution that touches on crypto exposure—whether it’s a trading API, a portfolio‑optimisation engine, or a compliance platform—ignoring the steady rise of crypto‑derivatives would be a misstep. The data suggests the market isn’t just surviving; it’s quietly solidifying its place alongside futures, options, and swaps that have defined modern finance for decades. Get in touch with our fintech expert