Bitcoin slumps with options showing traders turning defensive

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Bitcoin fell to its lowest level in more than two weeks as traders turned defensive following the year’s largest options expiry, while investors continued pulling money from crypto exchange-traded funds.

The original cryptocurrency fell as much as 4.3% to $65,997, the lowest since March 9. The token has been stuck between roughly $60,000 and $75,000 in recent weeks, drifting well below its October 2025 peak of around $126,000.

Roughly $14 billion of Bitcoin options expired Friday, as measured by the number for outstanding contracts, known as open interest. The quarterly rollover comes amid conflicting signals on the prospect of a halt to the nearly month-long war in the Middle East.

Looking at traders’ positions, they seem to be anticipating a prolonged war, potential stagflation, and “forced rate hikes,” leading to a significant increase in bearish sentiment, said Griffin Ardern, Co-founder of multi-asset manager Primal Fund.

“With the expiry behind us, the price pin has faded, and the market is beginning to show its true directional intent,” said Pratik Kala, a portfolio manager at Apollo Crypto, a digital-asset hedge fund.

The highest open interest is now concentrated in $60,000 puts, according to data compiled by Deribit. Traders often use puts - which give the holder the right to sell the underlying asset at a specific price - to hedge against declines. The put/call ratio over the past 24 hours stands at 1.3, indicating increased demand for downside protection heading into the weekend.

In the past 24 hours, about $450 million in liquidations were seen, according to data compiled by Coinglass.

Meanwhile, Wall Street traders drove global stocks and bonds lower ahead of the weekend on concern that a protracted war in Iran will keep oil prices elevated, fueling an increase in inflation and a slowdown in growth. The drop in equities put the S&P 500 on course for its longest streak of weekly losses since 2022. The Nasdaq 100 fell into correction territory after a 10% decline from its peak. Brent hovered near $111 as traders braced for the conflict to stretch into April as attacks continued across the Middle East.

Bitcoin has been stuck in a range since the conflict in Iran began in late February, at one point jumping to a high of nearly $76,000 before tumbling. A credible ceasefire could push Bitcoin above $75,000, triggering further gains as bearish positions are unwound, said Andreja Cobeljic, head of derivatives trading at AMINA Bank.

While March has seen about $1.4 billion of net inflows into Bitcoin ETFs — a stabilization after four straight months on net outflows — those allocations have proven sensitive to macro shifts. Investors withdrew $171 million from spot ETFs on Thursday, data compiled by Bloomberg show.

Across the more than 150 crypto-focused ETFs, $260 million came out during the latest session, with a big outflow from ETHA, the iShares Ethereum Trust ETF. Roughly $140 million was pulled from that fund, the most in two months.

“The nervous mood in the financial markets makes cryptocurrencies, and Bitcoin in particular, vulnerable in the event of a large-scale selloff,” said Alex Kuptsikevich, chief market analyst at FxPro.

Bitcoin accounts for almost 60% of the roughly $2.3 trillion digital asset market, while Ether makes up around 10% of the overall value, according to data compiled by CoinMarketCap. Bitcoin and Ether are down around 50% and 60% from all-time highs, respectively.
source: https://www.tradingview.com/news/moneycontrol:bfadabfe1094b:0-bitcoin-slumps-with-options-showing-traders-turning-defensive/