Bitcoin Options Traders Bet on $115,000 by Year-End as Overheating Signs Stay Muted

Investors in the Bitcoin options market are increasingly betting the cryptocurrency will climb above $115,000 by year-end. Even so, derivatives indicators suggest signs of overheating remain limited.

Cointelegraph reported on May 8 that open interest in Bitcoin options expiring on Dec. 25 stood at about $6 billion.

A sizable share of that total is in call options tied to Bitcoin rising above $115,000. Open interest in those contracts was about $1.85 billion.

Bitcoin has rebounded about 33% since touching this year's low of $60,130 in February. The recent advance has fueled expectations for further gains by year-end.

Still, the options market is not yet showing excessive optimism.

Many options positions are being used for hedging or market-neutral strategies rather than simple directional bets, Cointelegraph said.

At the same time, put options betting on a drop below $55,000 accounted for about $1 billion in open interest. That suggests both bullish and bearish investors are making bets on extreme price moves.

The options skew, a gauge of sentiment in the derivatives market, has also remained largely within a neutral range.

The premium on Bitcoin put options is currently about 9% higher than that of call options. Generally, a skew reading between negative 6% and positive 6% is interpreted as neutral.