Bitcoin’s Record Options Open Interest Suggests Bullish Market Sentiment Amid Potential Profit-Taking Risks

Bitcoin’s soaring Options Open Interest suggests increasing bullish sentiment, yet impending call expiries pose risks of heightened volatility and profit-taking.

• Bitcoin’s Options Open Interest has surged to unprecedented levels, signaling substantial bullish positions among traders.

• Institutional trading patterns are shifting, indicating a broader risk-off approach as economic uncertainties escalate.

Bitcoin’s [BTC] recent lack of upward momentum, particularly after breaching its all-time high, is indicative of more than just market fatigue; it’s a reflection of macroeconomic factors at play.

The initial discussions around trade tariffs have now evolved into significant legal battles, injecting further uncertainty into the market.

This macro backdrop is impacting risk assets, as evidenced by the U.S. 10-year Treasury yield, which dropped 4.75% in the last week, signaling a strong risk-averse shift among investors.

This reallocation of capital to safer assets has set the stage for opportunistic short positions.

The repercussions? A staggering $657 million was liquidated within a mere 24 hours, predominantly affecting over-leveraged long positions.

According to COINOTAG, this could be just the beginning of heightened market volatility.

Record-breaking Options expiry approaching as OI reaches all-time high

Data from Glassnode reveals that Bitcoin Options Open Interest has soared to an all-time high of $46.2 billion, accumulating a notable $25.8 billion since early April.

The put/call ratio stands at 0.77, signaling a strong bullish bias, with Options traders predominantly opting for upside exposure.

Conversely, Bitcoin Futures Open Interest has seen a contraction of over $3 billion in the past week, indicating bearish pressure on the spot price.

This divergent trend is significant: while Futures traders are unwinding positions amid macroeconomic uncertainty, Options market participants are strategically deploying capital without triggering liquidation events.

Source: Glassnode

Nevertheless, this tactical positioning carries inherent risks.

Approximately 93,000 contracts are set to expire soon, with the $100,000 price level emerging as the max pain threshold. Many of these calls are deeply in the money, creating conditions ripe for significant profit-taking.

Traditionally, Bitcoin’s price tends to gravitate toward heavy options expiry clusters as market makers hedge their bets. Will this environment lead to a drop back below the six-figure mark?

Liquidity pools thicken as Bitcoin’s volatility intensifies

While a call-heavy Options order book typically signals robust bullish sentiment, increasing volatility converts this into a high-stakes gamble.

After an uninterrupted 11-day inflow period, BTC ETFs saw a reversal with a sharp $347 million outflow, highlighting a strategic recalibration among institutional traders in light of current market conditions.

Simultaneously, the number of Bitcoin whale wallets, holding more than 1,000 BTC, has decreased markedly in the last four days, aligning with Bitcoin’s drop from $109,000 to $105,000.

This environment coincides with escalating trade tensions, now manifesting in legal proceedings, prompting retail investors to seek refuge in bonds rather than riskier crypto bets.

Source: Trading Economics

Together, the resulting deleveraging across both spot and derivatives markets indicates the likelihood of a broader distribution phase.

As Options traders—many holding deep “in-the-money” calls—consider unwinding and hedging, this could amplify short-term selling pressure.

In this liquidity-thin environment, the structural flows favor bearish outcomes. Unless risk appetite rebounds or market positioning resets, a retest of the $100,000 level for Bitcoin seems probable.

Conclusion

In summary, while Bitcoin’s record Options Open Interest reflects significant bullish sentiment, the upcoming expiries and institutional shifts signal a complicated outlook. Traders should brace for potential volatility and adjust their strategies accordingly as the market navigates this landscape.