LMAX Digital volumes rocketed higher on Tuesday after a mild start to the week. Total notional volume for Tuesday came in at $723 million, 57% above 30-day average volume.

Bitcoin volume printed $499 million on Tuesday, 90% above 30-day average volume. Ether volume came in at $148 million, 5% below 30-day average volume.

Looking at average position size over the past 30 days, we’re seeing average bitcoin position size at $6,832 and average position size for ether at 2,717.

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 $1,002 and $106 respectively.

Crypto assets can’t get away from correlating with traditional risk sentiment right now. Tuesday’s fallout in financial markets from the hotter than expected US CPI print sent shockwaves through the stock market and rippled over into crypto as well.

It’s worth reminding that crypto is trading as an emerging market right now and this is in large part what is responsible for the correlation with traditional risk assets. We don’t see this correlation holding up into the medium and longer-term. But for now, this is the way it is.

This reality should actually be refreshing to crypto investors in many ways, mostly because the fallout we’re seeing is less tied to any fundamental vulnerabilities to the crypto asset class itself. Still, we also anticipate some short-term bumps on this front, with investors needing more regulatory clarity and the infrastructure needing to be built up more robustly.

On the horizon, is the much anticipated Ethereum Merge event. A lot of this has been overshadowed by the developments in global markets. We also believe a lot of this event risk has already been priced in, and certainly when it comes to the positives. If anything, this sets up a sell the fact type reaction, which could expose ether in the immediate aftermath.

But while the price of crypto is under pressure, the headlines around institutional adoption continue to be quite bright. These include Bank of America saying the Merge may lead to greater institutional adoption, the CME Group launching ether options, and MicroStrategy looking to sell stock to acquire more bitcoin.