TechFlow news, August 5: The latest report from QCP Capital indicates that panic selling and liquidations during Asia's morning trading session drove BTC and ETH to lows of $49,000 and $2,116 respectively. The immediate trigger for this downturn was aggressive ETH selling by Jump Trading and Paradigm VC, causing front-end ETH volatility to surge over 30% to reach 120%, exacerbating the situation as market makers rushed to reduce gamma exposure on short-dated options.
In addition, last Friday’s weak U.S. employment data worsened macro sentiment, combined with large-scale de-leveraging across various assets, leading to a sharp increase in market volatility. The VIX index spiked to 50 (surpassed only during the COVID-19 pandemic and the 2008 financial crisis), while one-month at-the-money USD/JPY volatility surged to 16%, further triggering liquidations. Global risk aversion intensified over the weekend after Israel killed a Hamas leader, prompting Iran to vow retaliation and the U.S. beginning troop deployments to the Middle East.
On the trading front, despite market turmoil, forward basis and funding rates remain healthy.
