Key takeaways:
– Bitcoin’s derivatives show caution: options skew hit 20% as traders fear another round of fund liquidations.
– BTC has recovered some losses but lags gold and tech stocks amid weak demand for leveraged long exposure.
Bitcoin (BTC) has jumped about 17% from the $60,150 low on Friday, reclaiming the $71,000 area. Despite the price recovery, derivatives metrics point to fragile conviction: roughly $1.8 billion of leveraged bullish futures were liquidated over five days, a sign that large leveraged long positions were force-closed and that some hedge funds or market makers may have suffered serious losses. (Aggregate futures liquidations: CoinGlass.)
This episode differs from the Oct. 10, 2025 crash — which produced a record $4.65 billion single-day liquidation — in that recent pressure unfolded across three straight weeks of selling. Yet bulls appear to have been adding exposure in the $70,000–$90,000 band: aggregate futures open interest on major exchanges was about 527,850 BTC on Friday, roughly unchanged week-over-week. Notional open interest fell to $35.8 billion from $44.3 billion, a 20% decline that mirrors the 21% BTC price drop over the same seven days, suggesting position sizes have been scaled back but participation remained.
A clearer gauge of professional demand is the futures basis (the premium of futures over spot). Under normal conditions a 5–10% annualized premium compensates for funding costs and settlement delay. The two-month BTC futures annualized premium slid to 2% on Friday — the lowest in over a year — indicating weak demand for leveraged bullish exposure. Restoring full bullish confidence may take longer even as BTC trades above $70,000, particularly with the spot still about 44% below its all-time high.
Options markets are signaling elevated fear. The BTC two-month put-call skew at Deribit spiked to 20% on Friday, a level typically associated with panic and heavy demand for downside protection. For context, skew was 11% on Nov. 21, 2025 after a 28% correction. When skew rises, traders are paying up for puts; when it flips negative, call demand points to FOMO-driven bullishness. The current 20% skew implies traders are paying material premiums for downside insurance amid no obvious single catalyst, feeding narratives that a major market participant could be insolvent and increasing the probability of further downward pressure.
In short, while spot BTC has recovered ground, key derivatives indicators — collapsing futures basis and sharply elevated options skew — reveal market participants remain risk-averse. That combination lowers the odds of a durable rally until leverage demand and options sentiment normalize.
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