Cryptocurrency markets continue to face broad-based selling, with only five assets among the 100 largest cryptocurrencies by market capitalization managing gains of at least 1% over the last 24 hours. The lack of significant winners reflects the cautious sentiment prevailing across the digital asset industry.

The limited group of gainers includes Arbitrum (ARB), Render (RNDR), Pepe (PEPE), Quant (QNT) and GateToken (GT). Most major cryptocurrencies, including Bitcoin (BTC), Ethereum (ETH), XRP and Solana (SOL), have declined, while only a few tokens have managed to maintain relatively stable prices.

The latest weakness comes amid concerns that technology stocks could experience another round of selling. Nvidia (NVDA), the world’s largest publicly traded company by market capitalization and a leading force in the AI industry, was down more than 4% in premarket trading.

Investor concerns intensified following reports about Nvidia CEO Jensen Huang’s alleged relationship with a woman suspected by U.S. officials of having connections to Chinese intelligence. Huang reportedly acknowledged the affair, prompting the company’s board to begin an independent investigation.

Crypto Derivatives Point to Reduced Market Exposure

Futures volume rebounds: Cryptocurrency futures trading activity climbed more than 200% to approximately $180 billion over 24 hours, recovering from the subdued activity recorded during the weekend.

Despite the increase in volume, aggregate open interest declined 3% to nearly $127 billion. The divergence suggests that traders were actively closing positions and reducing their exposure rather than building new market bets.

Total liquidations reached approximately $1.1 billion. The taker buy-sell ratio stood at 51.5% on the selling side, indicating a modest advantage for bearish market orders.

Bitcoin derivatives retain positive funding: Bitcoin’s futures open interest slipped 0.2%, while its price declined 2.2%. The smaller reduction in open interest indicates that traders maintained most of their existing derivatives exposure during the correction.

BTC liquidations reached approximately $305 million. Funding rates remained positive but declined compared with Thursday, suggesting that long traders continued paying short-position holders, although the bullish positioning premium weakened.

Ethereum derivatives shift toward bearish positioning: Ether experienced a more substantial decline in open interest, which dropped 6.7% alongside a 5.9% decrease in price.

ETH liquidations totaled approximately $498 million, considerably higher than Bitcoin’s $305 million, despite Ethereum’s open interest being roughly half the size.

Funding rates also turned negative after remaining positive on Thursday. This means short sellers are now paying long-position holders, indicating a change in derivatives market positioning.

Zcash and XRP experience notable position closures: Capital withdrawals were also evident in the futures markets for major altcoins.

Zcash (ZEC) open interest declined 9.7% as its price dropped 4.5%. XRP recorded a 9.2% reduction in open interest against a 6.5% price decline.

These larger contractions in open interest indicate that traders are unwinding positions and reducing their exposure to both assets.

Nvidia-linked derivatives see a trading surge: Binance-listed NVDA perpetual futures recorded a volume increase exceeding 200%, with activity rising above $500 million. The surge followed reports involving Jensen Huang and Nvidia’s decision to investigate the allegations.

Options traders increase downside protection: Bitcoin’s one-week implied volatility climbed to approximately 43%, compared with 33% on Thursday. Ethereum’s measure also increased, reaching roughly 60% from 46%.

The options skew for both cryptocurrencies moved higher, reflecting growing demand for protection against potential price declines. Bitcoin’s one-week skew increased from 2% to approximately 13%, while Ethereum’s rose from 7% to around 15%.

This suggests that investors are increasingly willing to pay higher premiums for put options as they prepare for further market weakness.

Put options dominate Bitcoin activity: Four of Bitcoin’s six most actively traded options contracts were put options, with strike prices concentrated between $70,000 and $72,000.

Ethereum’s options market showed a more balanced distribution, with three call contracts and three put contracts among its six most active positions. The most actively traded ETH contract was a December put option with a $1,900 strike price.

Ethereum and XRP Lead Losses Among Major Altcoins

Ethereum falls below its 200-day moving average: Ether declined approximately 5.9% to $2,100 after closing below its 200-day moving average on Sunday for the first time since August 18.

The price weakness coincided with significant forced selling. ETH accounted for approximately $501 million of the $1.16 billion in cryptocurrency liquidations recorded over the previous 24 hours, with bullish traders absorbing most of the losses.

XRP extends its decline: XRP dropped approximately 7.3%, placing it among the weakest-performing major alternative cryptocurrencies during the broader market correction.

Payment-focused tokens experience the biggest sector decline: Cryptocurrencies associated with payment networks recorded losses exceeding 5% as a category, making them the worst-performing sector.

Decentralized finance tokens declined approximately 3.5%, memecoins lost 2.35%, and layer-two cryptocurrencies showed greater resilience with a relatively small decline of 0.12%.

Arbitrum defies the wider downturn: ARB emerged as one of the strongest performers, advancing more than 5% over the past 24 hours despite widespread weakness across the cryptocurrency market.

Growing on-chain activity involving real-world assets (RWAs) has provided support for the token, allowing Arbitrum to outperform most major digital assets during the latest selloff.