Derive Predictions Update: March 4th 2025
Trump’s Strategic Reserve announcement triggers significant market volatility
March 4, 2025 by Dr. Sean Dawson
The market experienced major volatility following President Trump’s announcement of a U.S. Federal strategic reserve that would include Bitcoin (BTC), Ethereum (ETH), Solana (SOL), XRP, and Cardano (ADA).
ETH surged 15%, from $2,190 to $2,520 at its peak, while BTC jumped from $85,075 to $94,700. SOL rose from $140.29 to $178, XRP climbed from $2.23 to $2.94 and ADA skyrocketed from $0.64 to $1.14.
However, the rally was short-lived, as concerns about the lack of details in Trump’s proposal began to surface. Key figures, such as Brian Armstrong, expressed concerns about non-BTC assets like Cardano (ADA) being included in the reserve. This uncertainty led to a price correction:
- BTC dropped to $86,034
- ETH fell to $2,129
- SOL decreased to $142
- XRP dropped to $2.38
- ADA dropped to $0.85
On Derive.xyz, traders are showing strong demand for high-leverage calls, with 49.4% of BTC premiums and 45.5% of ETH premiums being calls bought. This indicates that traders are seeking upside exposure in the wake of the large price fluctuations.
BTC
Source: Derive.xyz, Amberdata
ETH
Source: Derive.xyz, Amberdata
BTC’s 7-day implied volatility jumped from 47% to 70%, and 30-day volatility rose from 47% to 55%. After the rally, volatility settled briefly but then spiked again as prices dipped.
Source: Derive.xyz, Amberdata
Price Predictions
The chance of ETH falling below $1,700 by the end of June has increased to 20%, up from 18% yesterday. While the probability of BTC dropping below $65K by the end of June remains steady at 17%.
This market behavior highlights that while announcements like Trump’s strategic reserve can spark short-term excitement, the lack of clarity and follow-through can lead to rapid corrections. Volatility will likely remain high as traders navigate the uncertain year ahead.