Many traders expect bitcoin to recover toward the $80K level between June and September, Derive said.
Bearish sentiments continue to dominate the Bitcoin market as the premier cryptocurrency looks to record a fifth consecutive monthly loss. Presently, prices are consolidating beneath the $70,000 mark, as market bulls struggle to force a decisive breakout above the resistance zone. Amid this choppy price action, data from the Bitcoin options market shows that traders are beginning to expect less volatility but still acknowledge the fragile nature of the market. Related Reading: Why Bitcoin Could Be Headed For Another Drop: Research Firm Cites Three Key Risks Bitcoin Volatility Expectations Drop, Market Panic Fades In an X post on February 20, Glassnode shared its weekly Bitcoin options market update, analyzing the traders’ behavior and sentiment in relation to present market conditions. The market analytics firm reports a notable change in volatility expectations that helps to subside the presently heightened bearish sentiments. According to Glassnode analysts, At-the-money (ATM) implied volatility across maturities has significantly dropped to around 48%, down significantly from recent highs. Because ATM IV reflects the market’s expected move, the decline suggests traders are no longer betting on an immediate price crash. Notably, this shift is reinforced by moves in DVOL, an indicator for measuring aggregate implied volatility expectations. Following initial spikes during the market liquidation in late January/early February, DVOL has fallen by roughly 10 volatility points over the past two weeks, signaling that extreme hedging demand is easing out. In addition, the short-term volatility risk premium (VRP) has turned positive. Earlier this month, one-week VRP plunged to deeply negative levels at -45, as realized volatility far exceeded implied. Since then, implied volatility has repriced higher while realized volatility has stabilized, restoring a premium in short-dated options. Together, these metrics suggest that panic pricing is being reset, and expectations for outsized, volatile moves have declined. Related Reading: XRP Ledger Gets x402 Facilitator For AI Agent Payments: Why This Is Bullish Bitcoin Traders Remain Alert To Downside Despite the cooling in volatility expectations, other metrics show that traders are maintaining a defensive market position. For example, the Put skew, which measures the relative demand for downside protection versus upside exposure, remains quite heightened despite moving off the extreme hedge. After bottoming near the 7 volatility points, the one-week 25-delta skew has rebounded toward 14 vol. The recovery indicates that while extreme fear has subsided, demand for downside insurance remains firm. The taker flow data also tells a similar story. Puts represented two-thirds of last week’s options activity, with outright put buying representing about 34% of total flow. The dominance of protective positioning suggests that market participants are not fully convinced the correction has run its course. In conclusion, the options market is signaling a more measured outlook, where expectations for immediate turmoil have faded, but traders are hedging to hedge against the risk of another downside. At press time, Bitcoin trades at $67,628 following a 0.92% gain in the last 24 hours. More data from Glassnode also shows that Dealers are broadly short gamma across a wide price range between $70,000 and $58,000, a positioning structure that could amplify selling pressure if Bitcoin extends losses. Conversely, a large gamma concentration around $75,000 suggests positioning for a potential rebound. Featured image from Flickr, chart from Tradingview
The derivatives exchange giant's switch to around-the-clock crypto trading will have a visible impact on liquidity and volatility on weekends, analysts said.
Heavy positioning at lower strikes signals rising demand for downside protection for bitcoin.
The company recorded a non-cash bitcoin valuation loss of 102.2 billion yen ($650 million) due to the cryptocurrency’s price drop.
Options trading on BlackRock's spot bitcoin ETF, IBIT, surged to a record 2.33 million contracts on Thursday as bitcoin crashed.
This surge in demand for lower-strike puts contrasts with the post-Trump-election pattern of enthusiasm for high-strike calls.
The spike shows traders rushing for protection, though implied volatility is not yet at extreme levels versus the past year.
The company forecasts revenue of over $100 million for FY2026, with 97.5% of projected sales coming from its Bitcoin Income Generation business.
Bitcoin’s June 26 options expiry provides a clean snapshot of how risk is being framed several months out, and the picture that emerges is one of deliberate insurance. Total open interest for the expiry sits near $3.92 billion in notional terms as of Jan. 20, with puts outnumbering calls at roughly 23.28K versus 19.87K contracts. […]
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Bitcoin is no longer an outlier, says OKX President Hong Fang. it now behaves more like a macro proxy — one that traders use to express their views on growth, risk appetite, and volatility.
By mid-January, open interest in Bitcoin options rose to about $74.1 billion, edging past Bitcoin futures open interest of roughly $65.22 billion. Open interest is the stock of outstanding contracts that have not been closed or expired, so it measures position inventory, not trading activity. So, when options inventory exceeds futures, it often shows a […]
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Institutions are increasingly using bitcoin options strategies on altcoins to manage price volatility and enhance returns, STS Digital told CoinDesk.
As the year comes to a close, Bitcoin (BTC) is approaching a pivotal moment that could lead to increased market volatility. This Friday, December 26, more than $23 billion worth of Bitcoin options are set to expire, marking the largest options expiration in the cryptocurrency’s history. How $23 Billion Roll-Off May Impact Bitcoin Prices Market expert NoLimit took to social media platform X (formerly Twitter) to elucidate the significance of this event. Understanding options expiration is crucial to grasping its potential impact on the market. In the expert’s words, options are leveraged bets on the future price of Bitcoin: call options anticipate an increase in price, while put options anticipate a decrease. When these options expire, one of two things happens: either they expire worthless, or they trigger hedging actions that necessitate buying or selling in the spot market. Related Reading: XRP Price Forecasts For 2026 Unveiled By AI Simulation: Should Investors Remain Bullish? With a massive $23.6 billion worth of Bitcoin options rolling off at once, a substantial amount of risk is being removed from dealer books in a single day. This clearing of positions is a primary driver of volatility. For perspective, previous year-end expiries have been significantly smaller: around $6 billion in 2021, $2.4 billion in 2022, $11 billion in 2023, and $19.8 billion in 2024. The sheer scale of this upcoming expiry highlights a shift in the market landscape, indicating that it is now largely shaped by institutional investors rather than retail traders. The specificity of this Friday is particularly noteworthy. Dealers have strategically hedged their positions around key Bitcoin price levels, and as the options expiry arrives, these hedges will be unwound. This process could lead to sharp price movements in either direction, especially given the current low-liquidity conditions in the market. The holiday season has resulted in diminished trading volume, which means that individual orders can impact prices more dramatically—potentially leading to violent price swings. Key Price Ranges Adding to the complexity, fellow market analyst MartyParty highlighted that significant gamma exposure is clustered in critical price ranges, particularly between $86,000 and $110,000. Estimates suggest that high gamma—around $238 million or more in notional sensitivity—will expire, amplifying volatility through delta-hedging flows as Friday approaches. The maximum pain point, where Bitcoin option sellers face the greatest loss, is pegged at $96,000. Related Reading: New Crypto Tax Proposal: Bipartisan House Duo Pushes For Stablecoin Safe Harbor Furthermore, analysts from CryptoQuant weighed in on the situation, noting that while downside positioning has eased with the open interest in $85,000 puts declining, there remains a notable presence of $100,000 Bitcoin calls. This suggests a cautious but persistent optimism for a potential “Santa rally,” according to the analysts. The risk reversals also indicate a softening of bearish sentiment as Bitcoin’s spot price stabilizes. At the time of writing, Bitcoin was trading at $87,292, having recorded a loss of 2.5% in the past 24 hours and a 30% gap between the current trading price and the record high. Featured image from DALL-E, chart from TradingView.com
The spread between BTC and S&P 500 implied volatility indices is widening again.
Market positioning implies a meaningful probability of sub-$80K BTC to start 2026, Derive's Forster said.
The $80K BTC put is now the most popular options play on Deribit.
Glassnode has explained how the Bitcoin options Open Interest has been climbing recently and looks set to explore new all-time highs (ATHs). Bitcoin Options Open Interest Has Already Bounced Back From Oct Expiry In a new thread on X, analytics firm Glassnode has discussed about the Bitcoin options market. This segment of derivatives trading involves traders betting on future price moves through contracts giving the right (but not the obligation) to sell or buy the cryptocurrency at a set price. Related Reading: Bitcoin Erases Recovery As Coinbase Users Relentlessly Sell Earlier, perpetual futures was the main derivatives trading pathway that investors in the sector used, but recently, demand for options has grown enough to challenge the futures market. One way to gauge interest in options is through the Open Interest, an indicator that measures the total amount of contracts related to the market that are currently open on all centralized exchanges. Here is the chart shared by Glassnode that shows the trend in the Bitcoin options Open Interest over the last few months: As displayed in the above graph, the Bitcoin options Open Interest reached a new record on October 31st. Shortly after, however, the metric saw a plunge due to the contract expiry. Options contracts come with an “expiry” date, on which the contract get either exercised or automatically closed out. A large amount of these expiries coincided on October 31st, which is why the indicator saw a flush. Interestingly, the options Open Interest has been quick to bounce back since then, with its value already halfway back to the ATH. Thus, it would appear demand for options is still alive and well. From the chart, it’s apparent that a similar pattern was also witnessed after the previous major expiry, when the metric gradually recovered and explored new records. “The options market open interest looks set to keep printing new ATHs, expiry after expiry,” explained the analytics firm. Related Reading: Bitcoin At Increased Risk Of Falling To $88,500 Support, Glassnode Warns In terms of trading volume, activity related to the market has been at notable levels since Bitcoin fell below the $107,000 level, as the below chart shows. How the volume related to the options market has changed over the past month | Source: Glassnode on X As Glassnode noted: Options volume has surged since we broke the 107K level and remains elevated showing the constant activities of the traders readjusting their positions and new traders coming in to put on some hedges. As for whether investors are opening bearish or bullish trades with these moves, data suggests bearish bets, or “puts,” initially rose during the plunge, but then bullish bets, or “calls,” saw a surge as price rebounded. Once again, however, puts have seen a rise, indicating investors don’t trust a bottom has appeared yet. BTC Price Bitcoin has retraced its recent recovery as its price is back at $100,900. Featured image from Dall-E, Glassnode.com, chart from TradingView.com
BTC recently fell below $100,000 as macro uncertainties weighed over spot ETF inflows.
Every few months, headlines warn of a looming multi-billion-dollar options expiry poised to shake Bitcoin price. This quarter’s figure, roughly $13 billion in notional contracts, sounds dramatic, yet it’s part of a well-worn pattern on Deribit, the exchange that clears nearly 90% of Bitcoin’s options open interest. The real story isn’t the size of the […]
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Key market dynamic points to potential for heightened market volatility ahead of Friday's options expiry.
The Bitcoin options market has quietly become one of the most revealing arenas for gauging trader sentiment. And right now, it’s flashing mixed but telling signals. While Bitcoin has clawed its way back from the early-October washout that vaporized tens of billions in leveraged bets, the options data suggests investors are still hedging their excitement […]
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Options open interest hits $108 billion, signaling a shift toward more sophisticated and regulated market structures.
Behind every rally and every crash lies an invisible engine: options dealers rebalancing billions in Bitcoin exposure. As open interest pushes past $57 billion, it’s the hedging flows, not sentiment, that now dictate price. For most of Bitcoin’s history, price discovery happened in the spot market. Retail traders and long-term holders set the tone, while […]
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Options flows now shape price direction more than spot trades as institutions lean on Deribit and IBIT to position around volatility.
The new offering comes as there is an increasing demand for hedging instruments across the full spectrum of crypto products.
Bitcoin’s options market has split into two very different regimes: a near-term tape that looks locked in place by dealer hedging, and a year-end setup that seems built to let price roam. Bitcoin price around $113,500, down from the August peak near $119,000, but still higher than where it was in early July. That puts […]
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BTC's upside gathered traction as options worth billions expired on Deribit.
The upcoming nonfarm payrolls report is expected to show an increase of 110,000 jobs, with the unemployment rate steady at 4.2%.
10x Research prefers the short strangle strategy for the second month as market dynamics point to near-term calm.