Key takeaways:
Bitcoin derivatives signal caution, with options bias reaching 20% as traders fear another wave of fund selloffs.
Bitcoin price recovered some of its losses from Thursday, but still struggles to match the gains of gold or tech stocks amid low demand for leverage.
Bitcoin (BTC) has gained 17% from Friday’s low of $60,150, but derivatives metrics suggest caution as demand for upside price exposure near $70,000 remains limited. Traders fear that liquidations of $1.8 billion of leveraged bull futures contracts in five days indicate that major hedge funds or market makers may have exploded.
Unlike the market crash of October 10, 2025, which culminated in a record $4.65 billion liquidation of Bitcoin futures, the recent price weakness has been marked by three consecutive weeks of downward pressure. Bulls have been adding positions of $70,000 to $90,000 as aggregate futures open interest increased despite forced contract liquidations due to insufficient margins.
Aggregate Bitcoin futures open interest on major exchanges amounted to 527,850 BTC on Friday, virtually unchanged from the previous week. Although the face value of those contracts fell from $44.3 billion to $35.8 billion, the 20% change perfectly reflects the 21% drop in the price of Bitcoin over the seven-day period. The data indicates that the bulls have been adding positions despite the constant decline in prices.
To better understand whether whales and market makers have turned bullish, one should evaluate the BTC futures base rate, which measures the price difference relative to regular spot contracts. Under neutral circumstances, the premium should range between 5% and 10% annualized to compensate for the longer settlement period.
The BTC futures base rate fell to 2% on Friday, the lowest level in over a year. The lack of demand for bullish leverage is somewhat expected, but it will take longer for bulls than users to regain confidence even when the price of Bitcoin surpasses $70,000, especially considering that BTC is still 44% below its all-time high.
Bitcoin Derivatives Metrics Indicate Extreme Fear
Traders’ lack of conviction in Bitcoin is also evident in the BTC options markets. Excessive demand for put options is a strong downtrend indicator, pushing the bias metric above 6%. Conversely, when fear of missing out arises, traders will pay a premium for call options, causing the bias metric to turn negative.
The BTC options bias metric reached 20% on Friday, a level that rarely persists and typically represents panic in the market. For comparison, the bias indicator stood at 11% on November 21, 2025, following a 28% price correction to $80,620 from the high of $111,177 reached 20 days earlier. Since there is no specific catalyst for the current recession, fear and uncertainty have naturally intensified.
Related: What really weighs on Bitcoin? Samson Mow analyzes it
Traders are likely to continue speculating that a major market maker, exchange or hedge fund has gone bankrupt, and this sentiment erodes conviction and implies a high probability of further price declines. Consequently, the odds of sustained bullish momentum remain low, while BTC derivatives metrics continue to indicate extreme fear.
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