Feb 24, 2025: Our weekly Institutional Insights explores the latest market developments — market performance, industry news, exchange-traded fund (ETF) flows, trending topics, upcoming events and token unlocks — to help you supercharge your crypto trading.

 explores the latest market developments — market performance, industry news, exchange-traded fund (ETF) flows, trending topics, upcoming events and token unlocks — to help you supercharge your crypto trading.

Weekly Highlight — Mixed Economic Data Leads to Risk-Off Strategies

For the past two months, the strong U.S. economy has given investors confidence to invest in markets, even amidst looming tariffs and a stricter Federal Reserve Board. However, recent data indicates that this support may be weakening.

Last Friday, several reports on consumer sentiment, housing and services contributed to the S&P 500's largest loss of the year as it fell 1.7%, wiping out its weekly gains. In contrast, bonds experienced a rally, driving the yield on 10-year Treasuries down to 4.43%. The VIX {

the Chicago Board Options Exchange's (CBOE) Volatility Index

, known as the "fear gauge"] spiked, but remained below 20, signaling increased market anxiety.

Previously, optimism among investors was fueled by speculation regarding U.S. president Trump’s policies promoting disinflationary growth. However, mixed economic signals are now causing concern, particularly a report showing a decline in consumer sentiment alongside rising long-term inflation expectations — the largest drop since 1995. Additionally, existing U.S. home sales fell for the first time since September 2024, further complicating the outlook.

While January's job growth appeared solid, with 143,000 jobs added and the unemployment rate stable, institutional investors began the year with a pro-risk stance, optimistic about the U.S. economy’s trajectory. Yet, the recent volatility in economic data has prompted a reevaluation of strategies.

Weekly Crypto Highlight — SEC May Drop Lawsuit Against Coinbase

Coinbase announced that the U. S. Securities and Exchange Commission (SEC) has agreed to drop its lawsuit accusing Coinbase of operating an illegal exchange, pending Commissioners’ approval. Following this news, Coinbase shares initially surged in premarket trading, but fell by 4% to $246.30 as of midday in New York. Bitcoin also declined by about 1%, trading at around $97,000.

This decision signals a shift from the aggressive regulatory stance of former SEC Chair Gary Gensler, who faced criticism from the crypto industry for enforcing regulations through lawsuits. Last week, the SEC likewise requested a pause on a similar case against Binance, highlighting ongoing developments regarding a regulatory framework for digital assets.

The SEC's complaint will be unfairly dismissed, meaning it cannot be refiled. Coinbase CEO Brian Armstrong stated that this dismissal will entail no fines or changes in the company’s operations.

Coinbase has actively engaged in Washington, D.C., donating millions to support pro-crypto candidates and recently adding Chris LaCivita, a former Trump campaign manager, to its advisory council. Armstrong has also communicated with Trump directly.

The SEC initially sued Coinbase in June 2023 amidst a broader crackdown on the digital asset industry following the 

. Gensler had claimed that many tokens fell under SEC jurisdiction. 

The dismissal alleviates a significant burden on Coinbase, allowing it to list more tokens and refocus on product development, rather than legal defenses. This outcome removes a key litigation risk, enhancing Coinbase's capacity to innovate. The company recently reported strong fourth-quarter earnings, and now aims to collaborate with Congress and regulators in order to establish clearer rules for the crypto landscape.

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Weekly Institutional Insights: Mixed Economic Data Rattles Market; SEC May Dismiss Lawsuit

Learn everything you need to know about Bybit's recent security incident and the next steps in this article.

Security breaches have shaped the cryptocurrency industry for over a decade, forcing exchanges to evolve, users to become more cautious, and regulators to tighten their oversight. From the infamous 

 collapse to the Binance security breach and 

, history has shown that while no platform is immune to threats, those that respond swiftly and transparently can emerge stronger than ever.

 where over $1.5 billion worth of ETH and stETH were compromised, and while any breach is a serious concern, our rapid response and transparency set us apart from past incidents. Unlike FTX, where billions disappeared in mere hours due to mismanagement, Bybit immediately secured assets, froze affected wallets, and maintained full platform operations. Funds remain backed 1:1, and users can continue to trade, withdraw, and deposit without disruption.

Looking at past events, we can understand how crypto security has evolved, what lessons were learned, and what the industry must do next to ensure a safer future.

A Look Back: The Most Notorious Crypto Hacks That Changed the Industry

One of the earliest and most devastating exchange hacks, 

 — valued at $450 million at the time, but worth over $36 billion today. The platform’s weak security, lack of cold storage, and failure to detect suspicious transactions led to its downfall.

The lesson was clear: Exchanges must prioritize secure wallet management, rigorous internal controls, and transparency. The Mt. Gox collapse led to better industry-wide custodial practices, ensuring that no single exchange could operate without proper security measures in place.

 due to a smart contract vulnerability. In a surprising turn of events, the hacker returned the funds, proving that on-chain tracking and community response could play a key role in recovering stolen assets.

The attack showed that DeFi projects need more rigorous security audits and multi-signature controls to prevent exploits at the smart contract level.

Unlike traditional exchange hacks, FTX’s downfall wasn’t due to external attackers but rather internal mismanagement and misuse of customer funds. In just two hours, billions of dollars were withdrawn, leaving users helpless as the platform collapsed.

This event reshaped the industry by accelerating Proof of Reserves (PoR) adoption, a transparency measure that allows users to verify an exchange’s solvency. FTX’s failure highlighted the need for stricter regulations, better internal accountability, and clear asset-backing policies.

In October 2022, Binance suffered a $570 million hack after attackers exploited a vulnerability in BSC Token Hub, a cross-chain bridge used to transfer assets between blockchains. The exploit allowed hackers to move 2 million BNB tokens off the network. 

Binance’s swift response helped limit the damage, with the exchange pausing the BNB Chain for several hours. This attack highlighted the risks associated with cross-chain bridges, reinforcing the need for stricter smart contract audits, real-time threat detection, and stronger validator coordination to prevent similar exploits in the future. 

Each of these incidents led to major security advancements and industry-wide improvements. Now, Bybit faces its own challenge — and just like Binance and other top exchanges, we are committed to coming back stronger than ever.

How Exchanges Have Improved Security Over Time

The best exchanges don’t just survive hacks—they emerge stronger by adopting new security protocols, improving transparency, and prioritizing user protection.

One of the most significant changes has been the shift to cold storage dominance, where most exchanges now keep 90% or more of user funds in offline wallets to minimize exposure to potential attacks. Security audits have also become an industry norm, with regular penetration testing, bug bounty programs, and white-hat hacker collaborations helping to identify and fix vulnerabilities before they can be exploited.

User protection funds, like Binance’s SAFU, have set a new standard for ensuring users don’t bear the cost of security breaches. AI-powered fraud detection and real-time transaction tracking have also become essential tools for identifying suspicious activity before it escalates.

Beyond individual exchange improvements, the broader industry has adapted through regulatory changes. Proof of Reserves (

) has become a key transparency measure, allowing users to verify an exchange’s solvency. Licensing requirements and exchange accountability frameworks have also become more stringent, making it harder for bad actors to operate unchecked.

How Bybit’s Response to the Crypto Hack Sets a New Standard

The way an exchange responds to a security incident defines its long-term reputation and user trust. Over the years, some platforms have struggled to manage hacks transparently, while others have turned crises into opportunities to strengthen security. Bybit’s response to this incident demonstrates our commitment to transparency, operational resilience, and user protection.

The speed of response is one of the most critical factors in mitigating damage during an attack. Bybit acted immediately, isolating affected wallets and preventing further losses. Unlike past incidents where breaches went undetected for hours or even days, Bybit’s security teams responded in real time. The ability to contain the situation quickly is a testament to our proactive monitoring systems, robust security protocols, and dedicated cybersecurity team.

Full Transparency and Real-Time Communication

Many users lose confidence in exchanges when there is a lack of clear communication during a crisis. From the start, Bybit has maintained full transparency, providing regular updates to reassure users that their assets remain secure and backed 1:1.

Rather than delaying information or releasing vague statements, Bybit has been upfront about the incident, outlining the exact steps taken to contain the breach and reinforce security. This level of openness is crucial in maintaining user trust and setting a new industry standard for responsible crisis management.

One of the biggest concerns during an exchange hack is whether users will face withdrawal restrictions or see trading halted. Bybit ensured that trading, deposits, and withdrawals remained fully operational throughout the incident.

This highlights the exchange’s financial strength and liquidity, ensuring that user funds were not affected. No restrictions were placed on withdrawals, and all assets remained backed 1:1. 

Bybit isn’t just focused on resolving the immediate issue; we are using this incident as a catalyst to further enhance security across the platform. While we already implement industry-leading security measures, we are now working with top blockchain security firms to audit our systems and implement even more advanced security solutions.

Bybit remains financially strong, with all user funds fully backed and secure. Our commitment to industry-leading security practices, user transparency, and rapid response times ensures that we will emerge from this incident stronger than ever.

As the crypto industry continues to evolve, Bybit is setting a new standard for how exchanges should handle security challenges — with transparency, operational resilience, and an unwavering commitment to user protection.

While exchanges continue to improve security, users must also take proactive steps to safeguard their assets. Here’s how you can strengthen your crypto security:

 or SMS-based 2FA to add an extra layer of protection. This prevents unauthorized access even if your password is compromised.

Use withdrawal whitelisting to ensure only pre-approved wallet addresses can receive funds. This minimizes risks from phishing scams or unauthorized transactions.

If you’re holding large amounts of crypto, consider hardware wallets like Ledger or Trezor. Unlike exchange hot wallets, cold storage keeps assets offline and safe from cyberattacks.

Hackers often exploit major security incidents by impersonating exchange support teams. Always:

Enable transaction alerts to receive real-time notifications for any account activity. Report any suspicious actions immediately to Bybit support.

By following these best practices, you can further protect your assets even during uncertain times.

The Bybit incident reinforces the need for continuous security improvements across the industry. Moving forward, we can expect:

Stricter Security Standards for Exchanges

Regulators may push for mandatory insurance funds to protect users in the event of security breaches. Additionally, exchanges will be expected to adopt stronger internal controls and more frequent security audits.

To combat sophisticated attacks, exchanges will likely invest in AI-driven risk monitoring that detects anomalies before a hack can escalate.

Greater Transparency and Proof of Reserves

 to ensure their funds are secure. Bybit remains committed to maintaining full backing of user assets and transparent operational updates.

More exchanges may introduce hybrid custody models, where users can trade while maintaining partial self-custody of their assets.

Crypto’s Strength Lies in Solidarity: Bybit’s Gratitude to Partners and Users

One of the most powerful takeaways from this incident has been the overwhelming support from our partners, industry leaders, and users. As soon as the news broke, top security firms, blockchain analytics teams, and exchange partners reached out, offering their expertise and assistance to track the stolen assets and enhance security.

We are incredibly grateful for the outpouring of support from our community. Crypto has always been an industry built on resilience and collaboration, and this event has reinforced that when one exchange is attacked, the industry stands together to protect users and strengthen security.

Bybit would like to extend a heartfelt thank you to our partners, users, and the broader crypto ecosystem for standing with us during this time. Your trust, patience, and unwavering support fuel our commitment to come back stronger, set new security benchmarks, and continue providing a safe and innovative trading experience.

Bybit’s Commitment to a Stronger Future

Despite this setback, Bybit remains one of the strongest and most well-respected exchanges globally. Our response to this incident proves that:

Bybit’s journey doesn’t end here. We will continue to improve, evolve, and set new security standards for the industry.

The crypto space must learn from every challenge, and with greater security, transparency, and resilience, we can build a safer, more trustworthy future for all users.

The road ahead is clear — Bybit is here to stay, and we are stronger than ever.

For real-time updates, you may refer to our official channels such as the 

Beginner

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Hacks That Strengthened Crypto: Responses That Build a Safer Future For All

As of mid-February 2025, the cryptocurrency market is experiencing movements driven by economic pressures and regulatory movements. 

As of mid-February 2025, the cryptocurrency market is experiencing movements driven by economic pressures and regulatory movements. Recent inflation data has rattled financial markets, leading to a sharp reassessment of expectations for Federal Reserve policy. A higher-than-expected Consumer Price Index (CPI) report has caused Bitcoin to dip below $94.2K before rebounding to approximately $98.1K. This fluctuation illustrates how macroeconomic factors are increasingly influencing digital assets, mirroring trends seen since early 2022 when the Fed began raising interest rates.

Santiment data reveals that discussions around the terms “CPI” and “inflation” surged to 1.75% of all crypto conversations, the highest level since 2022. This heightened sensitivity indicates that when markets are stagnant or declining, economic news is met with increased concern and fear, often leading to sell-offs. Despite the increased uncertainty, Bitcoin has demonstrated resilience, staying above the $98K mark. Nevertheless, continued inflation could lead to further volatility in risk assets such equities and crypto.

The LIBRA scandal has further complicated the crypto landscape. Argentine President Javier Milei's endorsement of the cryptocurrency led to a dramatic rise — and an even more significant fall in value, as it plummeted by 80% within days. Allegations of fraud surrounding Milei have intensified scrutiny of speculative assets, particularly meme coins, leading to a crisis of confidence among investors.

The fallout from this scandal reflects a broader trend of growing impatience with high-risk assets. Retail sentiment has turned bearish, as evidenced by increased mentions of selling across social media platforms. This shift highlights the need for thorough research before investing in speculative projects. The LIBRA incident serves as a stark reminder of the risks associated with relying solely on endorsements for investment decisions, prompting many traders to seek more stable and established cryptocurrencies.

Emerging Opportunities and Investor Behavior

Litecoin is gaining traction, driven by the possibility of a spot ETF approval that could pave the way for broader access to altcoins, further maturing the crypto market. As discussions around the term “Litecoin ETF” spike, market analysts are optimistic about the likelihood of approval, which could enhance investor interest in Litecoin and similar assets.

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Bybit x Santiment: LIBRA Scandal Gives Rise to Meme Coin Crisis; Litecoin ETF Anticipations Build Up

KAITO is the core currency of Kaito AI’s InfoFi ecosystem, enabling transactions, governance, staking, and community engagement.

The S&P 500 fell 0.43% amid Walmart’s weak outlook, with investors eyeing PMI and home sales data next. Gold rose 0.23% to $2,939 on safe-haven demand but retreated from a $2,954 high. Traders await S&P Global Flash PMIs. Coindesk Indices, an index measuring broader cryptocurrency market performance was up by 0.02%, with Bitcoin and Ether rising by 2.46% and 0.69%, respectively in the past 24 hours. Trade these markets and more with up to 500x leverage on Bybit MT5 using this 

Today’s top performer is BERA, which surged nearly 15.8% after The Graph integrated Berachain Mainnet on day one, enabling seamless onchain data access.

Berachain (BERA), founded in 2021, is a Layer 1 blockchain with Proof-of-Liquidity consensus, ensuring security and liquidity while maintaining full Ethereum compatibility. The Graph has 

 support for the newly launched Berachain mainnet from day one. Developers can now query Berachain data using Subgraph Studio, making it easier to organize and access onchain data. This integration enables the creation of fast and efficient frontends for Berachain-powered dapps.

Check Out the Latest Prices, Charts, and Data of 

 is the core currency of Kaito AI’s InfoFi ecosystem, enabling transactions, governance, staking, and community engagement. The total supply is allocated as follows: 56.67% to community and ecosystem initiatives (including ecosystem growth, creator incentives, and liquidity rewards), 25% to core contributors, 10% to the foundation, and 8.3% to early backers. Distribution is merit-based, using AI-driven assessments of engagement, governance participation, and long-term alignment with Kaito’s vision. Staking provides rewards and voting rights, ensuring active participation. A claim process for KAITO will be announced soon.

Yesterday, BTC Spot ETFs recorded a net outflow of $252.8M, including $33.5M from GBTC and $219.3M from non-GBTC funds.

. With $43 million in funding, this presents a valuable opportunity. To maximize your points, complete the "Generate at least one transaction on Sahara Testnet" task by sending a small amount of SAHARA via Metamask. This earns 20 points, a significant amount compared to other tasks. Ensure you take full advantage of this opportunity.

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KAITO Powers the InfoFi Ecosystem with Governance Staking and Community Rewards

Bybit Learn

Options

Trading

Bybit Options is excellent to hedge your crypto position. Here are some of the top reasons you should start with Bybit Options to maximize profits. 

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Bybit_Options_Fees_Revamp_Nov24.png

Diversifying your investment portfolio is essential, and crypto options offer an excellent way to manage risk and take advantage of price fluctuations in the volatile crypto market. 

Crypto options function in the same way as traditional options in the stock market. Essentially, they confer on you the right, but not the obligation, to buy or sell your crypto assets at a predetermined price and time. Options contracts predominantly offer the choice to trade call options, which give a buyer the right to purchase an asset, and put options, which give a buyer the right to sell an asset. 

In fact, crypto options have gained popularity in recent years because they don’t require substantial capital in order to get started, and they're less risky yet have the potential to generate higher percentage returns than any other method. 

We understand there’s a learning curve for users who want to understand how the options market works. In this guide, we’ll examine the fundamentals of crypto options and see how Bybit Options is an ideal choice to get you started.

Bybit Options are European-style cash-settled Options in the form of derivatives contracts that give you the right to buy or sell an underlying asset at a predetermined price and date. Buyers are required to pay a premium for a Call or Put Option for the rights to the contract.

Since the inception of this product about a year ago, Bybit USDC Options has gained popularity with consistent trading volume. The recent revamp of 

 further enhances traders’ potential to maximize their profits. 

Bybit Options sets itself apart from other options contracts for its versatility and flexibility. Unlike futures contracts, which obligate traders to buy or sell an asset at a specific price, Bybit Options give traders the freedom to exercise their rights at their discretion. In return, traders can make strategic decisions based on market trends and risk tolerance, thus increasing their chances of success at enhanced capital efficiency.

Bybit Options work similarly to traditional financial options contracts that revolve around two contract types: Calls and Puts. 

 holder to buy an agreed-upon amount of an asset for a particular price and date.

: This agreement gives the contract’s owner the right to sell an asset at an agreed-upon price later at a predetermined date.

European-style Options work differently from American-style Options, particularly regarding the contract’s expiration date. Even if a contract is 

 (ITM), the holder can't exercise their option until the set date, at which time the expected outcome of such a contract may have reversed.Bybit predominantly practices European-style Options because the expiration date is fixed, and the profit or loss can be estimated with precision.

When executing this contract, traders should be aware of the following mechanics: 

To learn more about how Bybit European-style Options work, let’s use an example.

 is a BTC Call Option with a strike price of $48,000, which will expire on Oct. 31, 2023. To illustrate the differences between Call and Put Options, we’ll use two different scenarios. 

The market price of BTC at the start of September is $25,000. Ann thinks the price of BTC will be much higher at the end of the month, while Bob believes that BTC’s price will decrease.

Ann buys a BTC Call Option for $1,000. This means she has the right to buy 1 BTC at $26,000 when the contract matures. Bob sells Call Options.

Scenario A: Upon expiration, BTC’s settlement price increases to $29,000. 

 Upon expiration, BTC’s settlement price dips to $24,000.

Let’s say that BTC is trading for $38,000 on September 1. Based on Bob’s research, he believes BTC’s price will drop by the end of the month. Ann, however, thinks BTC’s price is going to rise.

Bob buys a BTC Put Option for $1,000. This means that he has the right to sell 1 BTC at $37,000 when the contract matures. Ann sells Put Options. 

Scenario A: Upon expiration, the BTC settlement price dips to $35,000. 

:Bob exercises his Put Option and makes a $2,000 profit (i.e., $37,000 − $35,000). Minus his $1,000 premium, he walks away with a profit of $1,000.

:Ann needs to fulfill her obligation to sell the Put Option at a strike price of $35,000, and she loses $2,000 (i.e., 35,000 − $37,000). Deducting the $1,000 premium she receives, her total loss is $1,000.

 Upon expiration, BTC’s settlement price increases to $39,000. 

:In this case, Bob loses $1,000, which is the premium he paid for the Put Option.

:Ann doesn’t need to perform her obligations, and earns a premium of $1,000.

The Importance of Hedging in Crypto Trading

Crypto Options have a reputation for hedging and profit maximization, especially in volatile market conditions. Take crypto trading as an example. The prices of cryptocurrencies can swing dramatically in a short period, leading to substantial losses if not properly managed. By hedging their positions, traders can cushion their portfolios against these price swings and improve their overall trading performance.

Essentially, hedging helps protect users’ investments from unfavorable price movements. This involves taking an offsetting position in a related asset to mitigate potential losses.

In addition, hedging also provides profit opportunities. Therefore, even if you anticipate a decline in the price of a cryptocurrency, you can hedge your position by buying a Put option. If the price does indeed fall, the value of the Put Option will increase, offsetting the losses from your original position. Similarly, if you expect a price increase, you can buy Call Options to capitalize on the upward movement.

What Sets Bybit Options Apart From the Rest?

 (UTA) can enjoy enhanced capital efficiency by offsetting their 

 on all Derivatives positions on Bybit, including Bybit Options. 

With the UTA, Bybit Options traders can better hedge their positions without separating their accounts for different Derivatives products, so margins won’t require additional capital for offsetting risks. Since margin trading with a UTA is at the account level instead of the position level, margin requirements could be significantly lower. Thus, traders have more protection for their hedged positions. 

Highly Competitive Options Fees and Best-in-Class Liquidity

Bybit Options trading involves three major fees: trading fees, delivery fees and liquidation fees.

Bybit recently revamped its Option fees across all users' VIP tiers, featuring some of the lowest trading fees in the industry — including zero settlement fees for short-term contract expiration. 

Below is an overview of Bybit Options fee revisions.

Bybit Options Fees Before and After the Update

Pioneer in the Stablecoin-Settled Options Market

 — most widely known for being the issuer of USD Coin (USDC). This partnership paves the way for the rapid growth of all things USDC, including the USDC Options offered on Bybit’s platform, allowing our traders to leverage the strength and stability of the leading digital dollar-based currency.

itigate the risk of volatile price swings without hedging their underlying collateral exposure, as the USDC stablecoin is less volatile than any other cryptocurrency. The ease of calculating profit and loss (PnL) in USD equivalents makes it easier for traders to benchmark and calculate returns. 

Innovative Portfolio Margin Boosts Profitability

 mode helps traders optimize their margin requirements for their trading positions. It considers the overall risk of a portfolio, rather than each position in isolation. By reviewing portfolio-level risk, brokers or exchanges can potentially reduce their margin requirements, which translates into increased buying power and trading flexibility.

Portfolio margin benefits traders by allowing them to trade larger positions with less margin required. This can increase buying power and capital efficiency, potentially opening the door to more trading opportunities.

Bybit Options is one of several trading platforms in the industry to utilize this feature of ETH and BTC Options. Users benefit by lowering their margin requirements on hedge positions that are aligned with the overall risks of the entire portfolio. At the same time,

 Portfolio Margin mode offers traders increased access to leverage, which can help them increase their exposure to the market while maintaining a balanced portfolio. 

With increased leverage, traders can hold larger positions with less capital for a higher return potential with calculated risks.

Trade With Safety and Fairness: Industry-Leading Risk Control

Bybit is committed to protecting users from financial and security risks. We deploy multi-layered liquidation protocols to ensure all Bybit traders can manage risks and safeguard themself from excessive loss in a safe and fair environment. In addition, users on the platform are free to customize their personal settings based on their preference for additional protection and enhanced security.

Trading crypto options on Bybit can be a profitable venture when done correctly. 

Bybit Options: Advantages to Hedge Your Positions & Maximize Profits

Grab Up to 5,000 USDT in Rewards

Grab Up to 5,000 USDT in Rewards