With the bear market in full throttle, crypto derivatives retain their popularity

cointelegraph.com:

The 2022 cryptocurrency bear market has been the worst on record as most Bitcoin traders are underwater and continue to sell at a loss. In response to the rapid decline of token prices, some investors have fled to save haven assets; some have exited the market completely, while others have perplexingly turned to the enigmatic market of crypto derivatives. 

With regards to this, Cointelegraph spoke to BingX's brand lead Emerson Li. BingX is a Singaporean social-based cryptocurrency exchange known for its leaderboards where users can compete with others for return on investments, as well as share ideas among their followers. The exchange processed around $319 million in trading volume within the past 24 hours, mainly consisting of derivates. Regarding the recent market downturn, here's what Li had to say:

During bear markets, traders can purchase derivatives known as put options to either hedge their positions or speculate that the value of underlying tokens will fall. While this can be done by simply shorting the coin, violent and periodic bear market rallies can lead to theoretically infinite losses on one's short position. In addition, a lack of liquidity for borrowing coins to short may lead to exchanges charging high-interest rates on one's positions. On the other hand, the put buyer's losses are theoretically limited to the premium they paid for the derivative, and there are no additional interest fees. 

Li went on to explain that BingX is also seeing a sharp increase in deposits as of late. "Since high market volatility is suitable for the derivatives market, we see more users participating in such transactions and stimulating more demand for deposits."

Money also appears to be flowing back to CeFi products from DeFi