Charm is the rate at which an option’s delta changes as time passes with price unchanged. The general mechanic is covered in charm and vanna; what matters for a dealer is that it produces a hedging requirement from the clock alone.
An out-of-the-money option’s delta bleeds toward zero as expiry approaches. Dealers hedged against it must unwind that hedge — buying or selling the underlying because time passed, not because price moved.
What the daily cycle changes
Equity charm flow is lumpy: it builds through monthly expiry week and produces a recognisable pattern into Friday. Crypto has an expiry every day, so there is always a contract in its final hours somewhere on the board.
The flow is therefore continuous and small rather than periodic and large. Which makes it harder to trade and harder to notice — and it also means the recognisable equity charm patterns simply do not transfer.
Where it still concentrates
On the large expiries. A quarterly carries a very different share of open interest from an ordinary Tuesday, so charm flow around it is meaningfully larger — the same size argument as in max pain and the daily pin.
So the honest statement is that crypto charm is background noise most days and a real flow into the quarterly, which inverts the equity intuition of a monthly rhythm.
No weekend discontinuity
Equity charm has an artefact: time passes over a weekend while the market is shut, so decay accumulates against a price that cannot move. Crypto has no such gap, so charm accrues smoothly against a market that is always trading — the same simplification described in theta in a market that never closes.
How much to weight it
Lightly. Charm flow is a second-order effect of a book that is already small relative to spot turnover. It is worth understanding as a mechanism and it is not a level to trade off, which is true of most of the dealer map here and worth repeating rather than assuming.