Bitcoin’s drop below $78,000 after a rejection near the recent local range highs has left options traders wary, according to new data shared by Glassnode. The options market continues to show compressed volatility expectations, high demand for bearish hedging, and a gamma structure that could amplify weakness if Bitcoin moves toward the mid-$75,000 region, the company said.
This movement comes in the wake of a failed attempt to hold near the upper border of the recent local range. While spot price action has eased, the Glassnode thread focused on what derivatives positions under the surface suggest: traders are still paying for protection rather than aggressively chasing the upside.
“Bitcoin is back below $78K after being rejected near the recent local range highs,” Glassnode books. “Here’s what BTC options data shows about positioning, volatility expectations, and sentiment beneath the surface.”
Bitcoin options traders remain on the defensive
One of the clearest signals came from implied volatility. Glassnode said Bitcoin’s implied volatility resumed its decline after a short-lived rebound earlier in the week. One-week implied volatility is now close to 31%, down from 39% earlier this week, while longer-term implied volatility has also moved slightly lower.
The implication is that the market has not yet priced in a disorderly breakout in either direction, even as the bearish hedge continues to rise. “The market is pricing in a calmer environment in the near term again,” Glassnode said.
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However, this calm is not the same as a bullish situation. Glassnode said the 25 delta divergence remains “strongly in sell territory” after rejection near $82,000. The one-week skew briefly reached 24% before turning back, a signal that places continued trading at a strong premium on calls.
“Traders continue to prefer downside protection,” the company wrote.
The same caution was shown in Glassnode’s Deviation Ratio Index, which compares upside and downside implied volatility. Most execution periods stay below 1, which means puts are richer than calls. The exception is the six-month period, where the ratio still shows the call premium, indicating that the longer-term bullish demand has not completely disappeared.
Near-term positioning is more defensive. Glassnode said upside demand remains limited outside of longer-term structures, while the broader options surface continues to show investors looking for protection against further downside.
Realized and implied volatilities also diverge. One-month realized volatility is down about 27%, while one-month implied volatility is still closer to 35%. This leaves the volatility risk premium near recent highs, according to Glassnode.
“Options still cost more movement than what BTC has offered recently,” the company said.
The gamma profile adds another layer of risk. Glassnode has set a high volume Short gamma Set near $75,000, with roughly $3.2 billion of downside exposure below the spot price. In options markets, a short gamma put can force traders to hedge in ways that enhance spot moves, which can lead to increased volatility if the price approaches key levels.
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At the same time, positive gamma clusters near $78,000 and $80,000 may act as resistance. This setup leaves Bitcoin trapped between nearby bullish friction and a lower zone where the downward move could accelerate.
“This structure could accelerate downside volatility near 75K,” Glassnode wrote.
Flows during the past week also tended to the defensive. Puts in the market led the tape slightly, accounting for 25% of the premium, while bought calls also accounted for 25%. Call selling remained high at 25.7% of flow, reinforcing the picture of muted bullishness.
Glassnode’s conclusion was straightforward: front-end implied volatility continues to pressure, volatility spread widens, skew remains in the sell zone, the six-month skew index ratio only shows a call premium, defensive flows are weak, and a short gamma acceleration zone lies below the point.
For traders, the takeaway is less about outright panic and more about asymmetry. Bitcoin options are not pricing in a significant expansion in near-term volatility, but the market is still paying for downside protection and showing limited confidence in the near-term upside. Unless the spot price can reclaim the nearby resistance areas around $78,000 and $80,000, an options market will emerge. In a position that allows for constant caution.
At press time, Bitcoin was trading at $76,744.
Featured image created with DALL.E, a chart from TradingView.com
