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In a sharp reversal of sentiment, traders in the Bitcoin options market have moved from ultra-bullish bets to significantly more cautious positioning. Just weeks ago, open interest was heavily tilted toward $140,000 call options, signaling expectations of a continued rally. Now, attention has swung to $80,000 put options, reflecting growing anxiety about further downside risks as volatility rattles crypto and traditional markets alike.
The sudden shift comes amid mounting macroeconomic pressure and a recent string of risk-off moves across equities and digital assets. Bitcoin, which had reached highs near $120,000 earlier in the quarter, has since declined sharply, dragging down altcoins and triggering major liquidations. Options traders are increasingly hedging against deeper drawdowns, with put volumes rising rapidly and skew flipping negative, according to data from Amberdata.
Analysts point to a number of contributing factors: hawkish Fed signals, bond market instability, and geopolitical tensions continue to weigh on investor sentiment. While some view the rotation toward puts as a temporary overreaction, others see it as a reflection of fragile confidence in the current crypto cycle. Market makers have also been adjusting their exposures accordingly, adding to the selling pressure.
Despite the bearish tone, some traders believe this kind of sentiment reset is healthy. A cooling of excessive leverage and greed could pave the way for more sustainable growth, particularly if macro conditions stabilize in Q1. Until then, the market appears to be bracing for more turbulence as the options board now reflects a preference for caution over euphoria.
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