DeFi Speculators Turn to Ethereum ‘Squeeths’ and Straddles in Crypto ‘Crab Market’

Are we in a dog market, crab market, or… Musk market?

It seems like the only way investors are making money these days is gambling on when Elon Musk will post his next DOGE-centric tweet. 

Except for canine cryptocurrencies, the past several weeks have been horrifyingly boring in terms of price action. For the first time since 2020, Bitcoin’s 20-day volatility dropped below the S&P 500 and the Nasdaq. 

In sheer price terms, the leading cryptocurrency has traded roughly between $18,800 and $20,800. This sideways trading, or what some call a “crab market,” has made crypto markets—normally a place of dramatic sudden swings— one of the more boring assets in finance. 

Conversely, Dogecoin’s volatility has shot through the roof. The last time this specific metric was as high as it is now was all the way back in July 2021, according to Messari. 

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So, what’s a degen to do? How do you make a quick buck these days? Some are turning to structured options products. 

Options are contracts that offer traders the option, but not the obligation, to buy (call option) or sell (put option) an asset at a specific price at a specific date. Think the price of orange juice is going to drop this winter? You can buy some put options which will give you the right to lock in a higher price now should orange juice prices drop later on and flip a profit. 

There’s also a wide and varied market for both buyers and sellers of put and call options. Some people, like Warren Buffet, make their money purely on selling options, and might not have any actual interest in the underlying asset’s price action.

Despite the high rewards, these strategies can still be super complicated and time-consuming to maintain (even in a crab market). But several options projects in the space,…