From Deribit by Tony Stewart

ETH flow continued with Protective/Bearish Mar+Apr Put buying & offloading of ETH Calls, marking the top as ETH plunged 15%.

BTC flows were slow to follow, ostensibly protected by BTC ETF Net inflows.

BTC then turned reactive: Mar Puts(+spreads) on breaks & Calls on bounces.

2) Aside from ETH Mar 3.1-3.4k Puts bought & Mar 4.5+4.6k Calls sold, increasing Put Skew, a dominant trade was covering of ~25k Mar ITM 2.6k Calls (presumably sold as a failed Yield trade against underlying long ETH when Spot was far lower) then rolled to sales of 3.9-4k Calls.

3) This roll-up trade, executed with ETH at ~3.9k on the 14th of March had the impact of unloading ATM Gamma onto LPs, a gift ahead of what was to happen later in the week as ETH then fell another 500 points.

4) BTC Option flow was slow to follow.

The need for protection was side-lined by obtaining enough upside exposure as ETF net inflows hit records.

But as the seemingly improbable happened, the need for protection executed via Mar Puts(+spreads) was hastily added as BTC collapsed.

5) But whereas ETH (+Altcoins) sold off heavily, not protected by ETF inflows, there was confusion over BTC’s sell-off.

Ofc funding was elevated, but there appeared to be fundamental demand.

Thus BTC bounces just invigorated near-dated 70-75k Call buyers (not observed on ETH).

6) BTC Bulls are very keen to hear the Tradfi opening market bell, as they look to a CME gap a few thousand higher, and the ETF flow powerhouse returning after the weekend.

The uncertainty and confusion have led to Gamma being bought on dips, and/or as a reaction to market moves.

View Twitter thread.