The Bitcoin (BTC) options market is increasingly reflecting bearish sentiment as traders prepare for potential price declines. Recent market activity shows a growing prevalence of put options, signaling that investors are hedging against further downside movements. The trend highlights rising caution, especially after BTC slipped to a five-month low of $97,000.
Over the past three months, BTC options data have consistently pointed to risk mitigation strategies against potential price drops. The surge in put options—both in terms of volume and open interest—suggests that traders are bracing for a lower trading range. As BTC dipped below the $100,000 mark, put options gained further dominance, indicating market expectations of continued declines based on prior drawdown levels.
Compounding the bearish outlook is the Deribit Implied Volatility Index, which has been climbing since September, reaching its highest point since June. Rising implied volatility often drives traders to adopt protective positions, further boosting put option activity.
Put Options Point to Potential BTC Dip as Low as $80,000
Recent market data shows that traders are positioning for multiple downside scenarios. A total of $1.58 billion in put options were opened at the $90,000 strike price, while the $85,000 put option holds the highest notional value at $1.7 billion. Additional significant strike levels suggest BTC could drop further to $85,000 or even $80,000, reflecting cautious sentiment among options traders.
Put options also dominate the November 28 monthly expiry on Deribit, as well as weekly contracts extending through the end of 2025. While call options regain prominence only if BTC climbs above $110,000—with a notable concentration at the $140,000 level—the prevailing focus remains on downside protection.
Options Expiry and Market Positioning
The weekly Deribit options expiry recently occurred under bearish conditions, with BTC trading below the maximum pain price of $105,000. Open interest for the weekly expiry was concentrated around the $100,000 to $110,000 region, but BTC slipped below $97,000 as the market approached expiry.
Deribit reported that weekly BTC contracts held a notional value of $3.95 billion, while ETH accounted for $730 million. The BTC put-to-call ratio was 0.61, indicating bearish sentiment, while ETH had a slightly lower ratio of 0.59. Following the expiry, both BTC and ETH continued to drift lower, reflecting persistent negative market sentiment.
Over recent months, put options have gradually increased to account for up to 30% of total trading volume, signaling elevated risk aversion. Deribit maintains high open interest levels above $36 billion, although direct derivatives trading has slowed due to heightened liquidation risks.
Outlook for Q4
The BTC options market signals that traders remain cautious about the fourth quarter, suggesting that the performance seen in 2024 may not repeat. Rising put option dominance, elevated implied volatility, and continued hedging strategies all indicate that market participants are preparing for further downside, even as BTC occasionally rallies.
In conclusion, BTC options data highlight a market leaning toward bearish expectations. Traders are strategically hedging, with significant open interest at strike prices ranging from $80,000 to $90,000, while any meaningful recovery would require BTC to surpass $110,000 to bring call options back into focus. The ongoing sentiment reinforces the view that cautious positioning and risk mitigation remain central to the BTC derivatives market as 2025 draws to a close.
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