Latest Binance research reveals that Bitcoin ETFs now account for an average of 26.4% of BTC’s spot trading volume, with occasional peaks reaching up to 62.6%. This shift has contributed to Bitcoin’s growing market dominance.

The performance of Bitcoin ETFs has outpaced early Gold ETFs, with net inflows exceeding $18.9 billion in less than a year. Over 1,200 institutions have invested in Bitcoin ETFs, significantly higher than the 95 institutions that backed Gold ETFs in their early stages.

Bitcoin ETF Investments are Dominated by Retail Investors 

Retail investors represent 80% of the demand for Bitcoin ETFs, while institutional involvement has grown by 30% since the first quarter. Investment advisors have seen the largest growth, with a 44.2% increase in holdings.

Read More: What Is a Bitcoin ETF?

Although it may take years to fully integrate Bitcoin ETFs into broker-dealers, banks, and advisors, this gradual process is expected to drive wider adoption in the medium term, according to a Binance Research report shared with BeInCrypto. 

Investor interest in cryptocurrencies via ETFs continues to rise, with 45% of ETF investors planning to allocate to digital assets in the coming year. This positions crypto ETFs as the second most popular asset class after equities, overtaking bonds and alternative investments in demand.

“Gold racked up over 1 million ounces in ETF inflows last week, the biggest since October 2022—seriously wild! History shows when gold’s hype cools down, Bitcoin usually goes bananas. BTC’s chillin’ between $50K and $70K since April, while gold and silver keep mooning. With a solid $2 billion flowing into Bitcoin ETFs recently, peeps are hyped that after the US elections, BTC might finally blast past that all-time high,” Influencer Mario Nawfal wrote in an X post (formerly Twitter)

The research also shows that millennials are dominating the crypto ETF investments demographic. More than 62% of investors in this space belong to this demographic. In contrast, Baby Boomers have shown significantly lower interest.

ETF inflows have become a key market indicator for cryptocurrencies, as they often signal shifts in market trends. Fluctuations in ETF inflows and outflows have been closely linked to price movements in recent months.

Read More: How to Invest in Ethereum ETFs?

In comparison, Ethereum ETFs have seen weaker demand. Ethereum outflows reached nearly $103.1 million over the last few months. Notably, Ethereum ETFs recorded negative net flows in 8 of the past 11 weeks. 

Traders and investors in the crypto market should brace for volatility, with $5.26 billion worth of Bitcoin and Ethereum options expiring today.

Specifically, Bitcoin (BTC) options due for expiry total $4.25 billion in notional value, while Ethereum (ETH) options account for $1.01 billion. With this, markets await the impact of such expansive contracts’ expiring.

What $5 Billion Bitcoin, Ethereum Options Expiry Means

According to data on Deribit, an expansive 62,657 Bitcoin options contracts will expire on October 25, with a put-to-call ratio of 0.66 and a maximum pain point of $64,000.

At the same time, Ethereum’s options market is set to expire with 403,426 contracts. Today’s expiring Ethereum contracts have a put-to-call ratio of 0.97, with a maximum pain point of $2,600.

Read more: An Introduction to Crypto Options Trading.

The put-to-call ratio is an important sentiment indicator in options trading. It compares the volume of put options traded to call options. When this metric is below 1, it generally signals bullish sentiment, with more investors expecting market gains. On the other hand, a ratio above 1 often suggests bearish sentiment, signaling concerns about a market decline.

Meanwhile, based on BeInCrypto data, Bitcoin is trading at $67,962 as of this writing, while Ethereum is trading at $2,490. This means that while BTC is trading above its maximum paint point, Ethereum is trading below it.

Price Implication Based On Max Pain Point Theory

With Bitcoin price currently above its max pain point, if the options expire at the current level, it would generally signify losses for options contract holders. The reverse applies to Ethereum, which is below its strike price as options holders stand to benefit. This is based on the Max Pain theory, which predicts that options prices will converge around the strike prices where the largest number of contracts — calls and puts alike — expire worthless.

Therefore, it means that as the options contracts near expiration, Bitcoin and Ethereum prices are likely to draw toward their respective maximum pain points. This means BTC value may drop while ETH price could rise in a calculated move by smart money. Nevertheless, the pressure on BTC and ETH prices will reduce after 08:00 UTC on Friday, when Deribit settles the contracts.

It is also worth mentioning that the volume of BTC and ETH options expiring today is significantly higher than what was seen earlier in the month. BeInCrypto reported $1.4 billion in the trading week ending October 4, followed by $1.6 billion in the week ending October 11.

Subsequently, the week ending October 18 saw up to $1.62 billion option contracts expire. The leap to over $5 billion options expiring is therefore significant, with a sustained rising trend. Meanwhile, analysts at BloFin Academy say there is also a notable change in implied volatility (IV) ahead of the US elections.

“The change in implied volatility first reflects the election’s impact on the expected volatility of the crypto market. Whether it is BTC or ETH options, the implied volatility level of options expiring on November 8 has increased significantly and exceeded that of far-month options,” said the analysts.

They ascribe the change in IV to investors’ hedging and speculative needs. The analysts also observe relatively higher increases in BTC’s “election day option.” This shows that BTC is relatively more sensitive to macro events. For now, however, most investors remain on the sidelines, limiting the amount of volatility that should be expected in October.

Read more: 9 Best Crypto Options Trading Platforms. 

“Interestingly, investors seem to believe that there will not be much volatility in the rest of October. As most investors are on the sidelines before the election, the performance of the crypto market is mainly consolidation, which also boosts investors’ confidence in pricing lower volatility. Of course, affected by supply, demand, and sentiment, options expiring on Nov 8 are becoming more expensive,” BioFin Academy analysts added.

Another influencing factor, according to the analysts, is policy uncertainties in the US by the Federal Reserve.

Chainlink, a blockchain oracle provider, has announced its first expansion into Bitcoin’s decentralized finance (DeFi) ecosystem. It has collaborated with Botanix Labs to integrate Chainlink’s Cross-Chain Interoperability Protocol (CCIP) into the Spiderchain network.

This collaboration marks a significant step in extending DeFi functionality to Bitcoin. It does this by harnessing Chainlink’s proven infrastructure and Botanix’s Bitcoin Layer-2 (L2) solution.

Chainlink Enhances Bitcoin with Spiderchain and CCIP

As part of the partnership, Botanix Labs has joined Chainlink’s Scale Program. The program promotes sustainable growth of decentralized protocols by providing essential resources for long-term success. Chainlink Scale will allow Botanix to access its premium Oracle services, including data feeds, at reduced operational costs during the early phases of the Spiderchain network.

Meanwhile, Spiderchain’s integration of Chainlink’s technology offers numerous advantages for the Bitcoin ecosystem. The network runs on five-second block times, a dramatic improvement over Bitcoin’s 10-minute average. This enables faster transactions while at the same time reducing settlement times.

Read More: What Is Chainlink (LINK)?

With transaction fees of only a few cents, it becomes feasible to explore use cases like micropayments. This would have otherwise been impractical on Bitcoin’s main chain due to higher fees and slower processing times.

Notably, Bitcoin was not originally designed to support smart contracts. However, Spiderchain’s Ethereum Virtual Machine (EVM) compatibility makes this possible.

This advancement opens Bitcoin to more complex financial instruments and dApps, which offer deeper liquidity and greater capital efficiency.

“Bitcoin layer-2s are redefining how the world views Bitcoin. This partnership will enrich the Bitcoin ecosystem and the greater blockchain industry,” said Johann Eid, Chief Business Officer at Chainlink Labs.

Of note, Botanix Labs joins the list of firms adopting Chainlink’s CCIP. The protocol solves blockchain interoperability while maintaining data integrity and confidentiality.

Its functionality also extends to private chain-to-public chain transactions, offering a layer of privacy that meets both operational needs and regulatory demands. Key adopters include Mountain Protocol and Ronin Validators, among others.

Read More: How To Buy Chainlink (LINK) and Everything You Need To Know

Despite the advancement of CCIP, Chainklink’s powering token, LINK, continues to register poor price performance. BeInCrypto data shows that the LINK token is down by almost 3%. It is trading for $11.31 as of this writing.