Derive Options Price 31% Odds of Bitcoin Below $70,000 by Christmas
Bearish odds on Derive more than doubled in a week as bitcoin posted five straight weekly losses. Puts now make up 55% of premiums, a whale hedged 300 BTC below $60K, and K33 says perps leverage leaves the market ripe for a squeeze either way.
Bitcoin options traders on Derive now price a 31% probability that BTC finishes below $70,000 by Christmas, more than double the 15% implied a week earlier, according to founder and CEO Nick Forster. Bitcoin was changing hands around $73,500 on Wednesday after five consecutive weekly losses.
The upside odds collapsed over the same week. The chance of an $80,000-plus finish fell from 53% to 26%. Odds of topping $90,000 by Christmas dropped to 6% from 18%. A six-figure Bitcoin by December now sits at 1%, down from 5%, and even $100,000 by June 2027 slid to 14% from 22%.
Positioning followed the repricing. Puts made up 55% of total premiums traded on Derive, up from 36% the week before, while options volume rose 37% week over week to $418 million.
One trade stood out. Forster said a wallet spent about $14,000 to protect 300 BTC against a fall below $60,000 by Nov. 27, a position that could pay up to $3 million if bitcoin drops below $50K.
"One of the most interesting trades came just hours before Thursday's tech sell-off, when a wallet spent approximately $14K protecting 300 BTC against a fall below $60K by November 27,"
Nick Forster, founder and CEO of Derive
What pushed the market here
Bitcoin dropped below $74,000 on Tuesday after October US CPI rose 0.4% against expectations of 0.3%, and futures traders priced in further Fed tightening at the December meeting. That came a day after more than $1 billion in crypto long liquidations, as bitcoin broke below its 50-week moving average. Friday's US PPI release is the next test.
Spot demand is thin. US spot bitcoin ETFs had net outflows of $1.28 billion last week and another $296 million on Monday and Tuesday, per K33. Global bitcoin ETPs saw withdrawals of 31,652 BTC over seven trading days.
Leverage cuts both ways
K33 says perpetual futures open interest was around 353,000 BTC on Tuesday, a level exceeded on only 1.2% of trading days over two years. It is up 12% in 30 days while bitcoin lost 10%.
That is leverage building into weakness.
Vetle Lunde of K33 framed the risk:
"A breakdown could trigger substantial long liquidations, while a recovery could fuel short covering, amplifying price moves as leveraged positions unwind,"
Vetle Lunde, K33
K33 calls the market ripe for a squeeze in either direction. It also reports a 0.75 30-day correlation between bitcoin and the Nasdaq, in the 99th percentile since 2020, so equities are effectively steering the tape. The firm notes that of nine Nasdaq rebounds that continued higher, bitcoin gained in eight, with a median 2.9% return over 20 days.
The read for traders
Options pricing is not a forecast, but it shows where hedging money is going: toward $70,000 and, for a few, $60,000. With crowded perps, ETF outflows and inflation data still driving Fed expectations, a hot PPI on Friday could put the $70,000 level in play fast. A cool one could flip the script, with short covering doing the heavy lifting on a bounce. Size accordingly.
