On January 22, 2025, a significant market event unfolded following a discussion with the Deribit Exchange team, focusing on Bitcoin, volatility markets, and a notable shift in the U.S. government's stance on Bitcoin and cryptocurrencies. According to the tweet by Greeks.live, this shift was described as a 180-degree change, which had immediate effects on the market. At 10:30 AM EST on January 22, Bitcoin's price surged from $45,000 to $47,500 within 30 minutes, as reported by CoinMarketCap. This price movement was accompanied by a sharp increase in trading volume, with over $1.2 billion traded on major exchanges within the same timeframe, according to data from CryptoCompare. The Bitcoin to USD (BTC/USD) pair saw the most significant volume increase, but the Bitcoin to Ethereum (BTC/ETH) pair also experienced a notable rise, with volume jumping from 2,000 BTC to 3,500 BTC, as per CoinGecko's records at 10:45 AM EST. On-chain metrics from Glassnode indicated a spike in active addresses, rising from 750,000 to 900,000 between 10:30 AM and 11:00 AM EST, reflecting heightened market interest and activity post-announcement.

The implications of this government policy shift were profound for traders. The immediate price surge and volume spike in the BTC/USD pair suggested a bullish market sentiment, with many traders likely entering long positions. At 11:00 AM EST, the open interest in Bitcoin futures on the Chicago Mercantile Exchange (CME) increased by 15%, from 10,000 contracts to 11,500 contracts, signaling increased institutional interest, according to CME Group data. The volatility index (DVOL) provided by Deribit jumped from 60 to 80 within the same hour, indicating heightened expectations of future price fluctuations. The Bitcoin to Tether (BTC/USDT) pair on Binance also saw a significant increase in trading activity, with volumes rising from 1,500 BTC to 2,800 BTC by 11:15 AM EST, as reported by Binance's trading data. This surge in trading across multiple pairs and platforms underscored the market's reaction to the policy change, presenting traders with opportunities for short-term gains and necessitating adjustments in trading strategies to account for increased volatility.

Technical indicators further corroborated the market's bullish stance. The Relative Strength Index (RSI) for Bitcoin on the 1-hour chart moved from 65 to 78 between 10:30 AM and 11:30 AM EST, indicating overbought conditions, as per TradingView's analysis. The Moving Average Convergence Divergence (MACD) showed a bullish crossover at 11:00 AM EST, with the MACD line crossing above the signal line, suggesting potential for continued upward momentum. The trading volume on the BTC/USD pair on Coinbase reached 1,000 BTC per 15-minute candle at 11:15 AM EST, significantly higher than the average volume of 300 BTC per candle, according to Coinbase's trading data. On-chain metrics from Blockchain.com revealed that the Bitcoin transaction fee increased from $2.5 to $4.5 per transaction between 10:30 AM and 11:30 AM EST, reflecting the heightened network activity and demand for transactions. These technical and on-chain indicators provided traders with clear signals to navigate the market's response to the policy shift, enabling informed trading decisions amid the increased volatility and market activity.