Bitcoin has seen a surge in price recently, with some likely attributing the rally to the “Trump Trade” narrative. This uncertainty has pushed investors towards Bitcoin options, and front-end implied volatility for contracts with the earliest expiry is unusually subdued up to election day (November 5th).
This muted volatility suggests investors are holding back, waiting for the dust to settle. A spike in volatility is still expected however, around November 5th to 8th, which could either fuel big moves or, if it fails to materialise, signal a deeper market caution. With Bitcoin dominance reaching over 60 percent—a new cycle high—altcoins are now seeing severe drawdowns whenever BTC pullbacks.
Ethereum and Solana have both dropped around 12 percent from their recent highs, and ETH is now 40 percent down from its initial ETF rally. The speculative interest that once supported altcoins seems to have vanished, reflected in stable funding rates and muted overall market sentiment. With BTC absorbing most of the capital flow into crypto assets, altcoins are struggling to keep up, and without a fresh catalyst, their prospects for a comeback in the near term appear slim.
Even with last week’s pullback, Bitcoin’s overall resilience since its September low is noteworthy. In a nutshell, the current market dynamics point to an electrifying week ahead. Whether you’re a trader, investor, or casual observer, the road to election day promises to be anything but dull for the crypto market.
Recent developments in the industry reveal both regulatory challenges and notable growth. Immutable, a blockchain gaming platform, announced potential legal action from the SEC concerning its IMX token, as the agency intensifies its scrutiny of crypto assets. Immutable maintains that IMX is not a security and intends to defend its position.
Meanwhile, Tether reported record Q3 profits of $2.5 billion, with over $120 billion USDt in circulation and $102.5 billion in US Treasuries, highlighting its financial stability and extensive reserves. In Florida, the CFO of the state pension fund, Jimmy Patronis has said he supports expanding the state’s $800 million crypto portfolio as a hedge against federal control, suggesting this could increase if former President Trump is re-elected.
