Bybit, in collaboration with analytics firm Block Scholes, has released its latest Crypto Derivatives Analytics Report, revealing early signs of recovery in market sentiment following a volatile start to December 2025. The analysis focuses on the market dynamics after a sharp selloff on December 1st, which was triggered by hawkish signals from the Bank of Japan.
Despite positive catalysts like Vanguard opening its platform for crypto ETF and mutual fund trading, derivatives data indicates traders remain cautious. Major cryptocurrencies are still trading significantly below their all-time highs. Han Tan, Chief Market Analyst at Bybit Learn, noted, "Cryptocurrencies have been buffeted by multiple crosswinds, from shifting expectations surrounding major central bank policies, to mounting concerns over the viability of DATs." He added that prices are likely to remain beholden to macro forces in the immediate term, especially with a pivotal Federal Reserve rate decision looming.
Key highlights from the report include a market recovery underway, with Bitcoin (BTC) climbing to a two-week high above $93,000 and Ethereum (ETH) reclaiming the $3,000 psychological level. The report also notes subdued downside fear, as options traders have significantly reduced bearish positioning. The put-call skew premium has dropped sharply from 10-13 percentage points at the start of the month to just 2-4 percentage points currently.
Leverage activity remains muted. Open interest in perpetual futures has increased modestly during the recovery but stays well below levels seen before the October 10, 2025, liquidation event. This data suggests lower participation in leveraged positions and an absence of the liquidation cascades typical of over-leveraged markets.
Block Scholes' proprietary Risk Appetite Index shows that while sentiment is shifting positively, market participants have not yet turned fully bullish. This cautious stance is attributed to BTC and ETH still trading far below their peaks.
The report specifically highlights the performance of Basic Attention Token (BAT), which has surged over 100% since October 11 to around $0.27, significantly outpacing the broader altcoin recovery. The Ethereum-based token, integral to the Brave browser's advertising ecosystem serving over 100 million monthly users, has helped propel social tokens to become the second-best performing sector over the past month, trailing only privacy coins.
