Trump's tariff remarks did not shake the market; Bitcoin and Ethereum volatility have instead decreased. How are institutions responding?

[Crypto World] Recently, there has been an interesting phenomenon: although Trump has issued new tariff threats, the implied volatility of Bitcoin and Ethereum has not surged much; instead, it has been declining steadily since mid-November. Over the past two months, the overall implied volatility has decreased by 18 to 25 volatility points, a quite significant compression.

The reaction in the options market further illustrates the point. Investors’ enthusiasm for chasing gains is noticeably lacking, and the demand for downside hedging has not significantly increased. This indicates that market participants’ sentiment remains relatively stable and has not fallen into panic.

In such a volatility environment, institutional investors’ positions and options strategies have changed. Taking Ethereum as an example, many mature investors are adopting a “yield enhancement” approach: they continue to increase their holdings in spot, while simultaneously selling call options to collect premiums. It sounds a bit counterintuitive, but this strategy actually has its unique advantages—although it somewhat limits upward potential, in a market with low leverage and prices fluctuating within a certain range, this approach can better realize volatility, smooth out portfolio returns, and thus increase actual gains. Given the current market environment, it actually fits quite well.