The crypto market experienced a much-needed bounce on Wednesday, with bitcoin BTC$92,970.78 posting a 6.6% gain over 24 hours to $93,000 while ether ETH$3,070.49 ticked back above $3,050.

The CoinDesk 20 index (CD20) added 8% as many altcoins began to outperform bitcoin.

One exception: Zcash ZEC$333.22, the token that was consistently the plat du jour over the past few months is now down by more than 38% in the past seven days as traders begin to capitalize on heavily overbought conditions.

Trading volume across perpetual exchanges rose by more than 5% to $44 billion in the past 24 hours, suggesting that the latest move is backed by a mixture of spot buying and leverage trading.

Derivatives positioning

• Demand for leveraged product looks to be stabilizing as futures tied to most major tokens, including BTC and ETH, increased along with spot prices.
• Leading the growth in open interest (OI) are SUI, SOL, BNB and ADA.
• Funding rates for most tokens remain positive, indicating a bias for bullish long bets. TRX and WLFI are exceptions.
• On the CME, open interest in standard BTC futures collapsed to 121.67K, the lowest since February, 2024. BTC options OI slipped to 46K BTC, reversing the growth since early October. Clearly, CME's regulated derivatives have fallen out of favor.
• Positioning in ether futures has lightened, with OI falling to 1.95 million ETH, the lowest since September. Options OI has pulled back to 275K ETH from the recent high of 350.85K ETH.
• On Deribit, BTC and ETH puts continue to trade at a premium to calls, although the differential has narrowed since Monday.
• Block flows featured BTC strangles and call butterfly strategies and ether put spreads and call diagonal calendar spreads.

Token talk

• The altcoin market showed conviction overnight as several tokens posted double-digit moves to the upside, outperforming bitcoin's 6.5% advance in the past 24 hours.
• The best performers included SUI$1.7042 and chainlink LINK$14.38, which were up 30.8% and 24%, respectively.
• The upside shift demonstrates that the bearish trend the market has been in since early October is vulnerable, and that there is an avenue for a bullish reversal.
• However, liquidity remains low. Market depth has yet to recover from October's crash, meaning that price swings will be exaggerated and if bearish news hits the wire, the market will fall back to critical levels of support.
• Zcash ZEC$333.22 fell by a further 3% in the past 24 hours. It is now down by 38% over the past seven days as traders begin to take profits after a momentous rise between September and November.
• The "altcoin season" indicator is at 21/100, resting near record lows. This shows that while some altcoins have outperformed bitcoin, investors remain focused on the largest cryptocurrency as opposed to more speculative altcoin trades.