Bitcoin’s price jumped back over $71,000 after a considerable sell-off. However, indicators from BTC options suggest that professional traders remain wary regarding the durability of this rally. Is the downturn truly behind us?

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Key Insights:

• The derivatives market signals caution, with a 20% options skew indicating that traders are concerned about possible further fund liquidations.
• Despite recovering some of its losses from Thursday, Bitcoin struggles to equal the advances seen in gold or tech stocks amid low leverage interest.

Bitcoin has surged 17% since touching a low of $60,150 on Friday, yet the underlying metrics caution against assuming a sustained rebound, with high liquidations (totaling $1.8 billion) in leveraged bull futures contracts indicating possible turmoil among major hedge funds or institutional traders.

Market Analysis

Source: CoinGlass

Currently, the total open interest in Bitcoin futures across leading exchanges has reached 527,850 BTC as of Friday, showing little change from the previous week. Although the notional value of contracts decreased from $44.3 billion to $35.8 billion, this shift reflects Bitcoin’s price decline of 21% over the week.

Further analysis is required to understand if institutional investors and large traders have turned optimistic yet, as evidenced by the BTC futures basis rate, which indicates the disparity in pricing relative to standard spot contracts. Ideally, this premium should be between 5-10% annually.

The BTC futures basis rate dropped to 2% recently, marking its lowest in over a year as demand for bullish leverage diminishes, suggesting that optimism is slow to return even with Bitcoin trading over $70,000, especially given it remains down 44% from its all-time peak.

Bitcoin Derivatives Metrics Showcase Severe Anxiety

The hesitance of traders regarding Bitcoin is also notable through the BTC options markets, where excessive demand for put options has pushed the skew metric beyond 6%. This behavior denotes a strong bearish sentiment.

BTC Options Skew

Source: laevitas.ch

As of Friday, the BTC options skew reached 20%, a concerning level associated with market panic. Comparatively, this skew was at 11% on November 21, 2025, following a significant price drop. With no specific trigger cited for the current downturn, anxiety and uncertainty amongst traders are escalating.

It seems probable that speculation surrounding the bankruptcy of a significant market maker or hedge fund is contributing to this sentiment, which is detracting from investor confidence and implies elevated risks of further price decreases. Thus, the likelihood of sustained bullish movement remains limited while BTC derivatives metrics reflect severe fear.