Bitcoin’s options market has turned notably less defensive over the past month, unwinding the downside protection traders built up in June just as the Federal Reserve prepares to meet.
The put/call ratio on open interest, which measures how much of the market is positioned in puts, contracts that pay off when the price falls, against calls, which pay off when it rises, has dropped to roughly 0.52 from about 0.76 in late June, according to Glassnode.
Calls are gaining share, the pattern of traders stepping back from hedging rather than adding to it. Recently, large traders have been accumulating $70,000 strike calls and bull call spreads, signaling expectations of upside in the spot price.
The 25-delta skew, the premium traders pay for downside protection relative to equivalent upside exposure, has fallen to around 4% at the one-week tenor while three- and six-month contracts hold at 11% to 12%. That indicates traders are still paying for insurance against something going wrong later this year, but have largely stopped paying for it this week.