LMAX Digital volumes recovered on Tuesday after a slow start to the week on account of the US holiday closure. Total notional volume for Tuesday came in at $511 million, 11% above 30-day average volume.

Bitcoin volume printed $307 million on Tuesday, 18% above 30-day average volume. Ether volume came in at $144 million, 12% below 30-day average volume.

Looking at average position size over the past 30 days, we’re seeing average bitcoin position size at $7,436 and average position size for ether at 2,961.

Volatility has been absent from the market for much of 2022 and is still trending down at yearly low levels. We’re looking at average daily ranges in bitcoin and ether of $819 and $102 respectively.

Cryptocurrencies haven’t been able to ignore the added downside pressure we’ve been seeing on risk assets in recent sessions. The pressure has resulted in a noteworthy break of a tight multi-session consolidation in the price of bitcoin, which now opens a direct retest of the yearly low.

What’s most interesting about this latest price action is that we are seeing something we don’t normally see when risk comes off. We’re seeing this strange phenomenon of ether outperforming bitcoin in risk off despite ether being the more risk correlated cryptocurrency.

But it’s easy enough to reconcile the anomaly, given that we are fast approaching the highly anticipated Ethereum upgrade, with most of the market anxious to increase exposure to eth ahead of the event. There are indeed plenty of risks around the Merge, but it seems the market is more comfortable playing into the positives at the moment.

On the whole, we’ve talked about how we’ve been noticing a little more of a breakdown in correlations between cryptocurrencies and traditional assets. And now that bitcoin is getting down towards a critical support barrier at $10k, we think we are that much closer to seeing this disconnect, where the market will be happy to buy bitcoin, even if we do see more fallout in traditional markets.

After all, for those in the know and who believe in the longer-term value proposition, bitcoin is anything but an emerging market, risk correlated asset. To these investors, bitcoin is very much the future and a clear cut store of value alternative.