Bitcoin Options Market Shrinks 33% as Traders Bet on Upside

Bitcoin's market has entered a phase of reduced activity, but beneath the surface, trading behavior is undergoing a noticeable transformation. Market participants are increasingly positioning for upward momentum, with signs suggesting a shift in sentiment toward optimism. The Bitcoin options market has seen a significant contraction, with its total notional value falling by approximately 33%, equivalent to a drop of $13 billion over a matter of days. This decline in activity shows a more settled outlook among sophisticated investors, who are adapting to what appears to be a quieter period.

Rather than following traditional hedging strategies, some traders are taking a more directional approach. Data shows that market participants are moving away from downside protection and are instead positioning to benefit from calm price action. This is particularly evident in a reduction in put option purchases and a noticeable increase in call option selling, pointing to growing confidence in Bitcoin’s short-term price range.

At the same time, institutional interest appears to be increasing steadily. Spot Bitcoin ETFs accumulated 15,000 BTC over the past week, marking the third consecutive week of net inflows. Demand for these products has accelerated since the beginning of June, reinforcing the outlook for continued adoption by large-scale investors. However, continued selling from retail investors and Bitcoin miners has limited the overall upside pressure.

Macroeconomic factors are also supporting the current sentiment. The Federal Reserve’s more cautious stance, combined with strong equity markets and reduced trade tensions, has created a friendlier environment for risk-taking, prompting traders to adopt strategies suited to a steadier market. The recent expiry of major options contracts, especially those used to guard against price drops, may have opened the door for upward momentum. With many of those puts ending without value, it indicates the expected decline didn’t occur. Combined with a shift toward selling call options, this development may have eased some of the pressure that had been holding Bitcoin back.

While Bitcoin continues to consolidate between $100,000 and $110,000, traders maintain long positions and consider selling call options to generate income in the current low-volatility environment. Adding to this analysis, independent analyst CryptoCon has highlighted the structural rhythm in Bitcoin’s price movements across the current cycle. Since December 2023, Bitcoin has spent 195 days moving within a relatively narrow range, a pattern consistent with prior market cycles.

CryptoCon’s research divides Bitcoin’s behavior into two phases—range periods and expansion bursts. Range periods refer to the lengthy stretches when price moves sideways, often appearing uneventful. Expansion bursts are the short, sharp rallies where price breaks out of its range, often driving significant gains in just a few days. From early 2023 to mid-2025, this pattern has repeated consistently. Brief price surges—some lasting just two to five days—have been followed by long periods of horizontal price action. So far in 2025, there have been two minor bursts, each lasting only two days, separated by over 100 days of sideways movement. These timeframes support the observation that the majority of gains have occurred in short, compressed intervals.

CryptoCon’s analysis further reveals that only 36 days in the current cycle have accounted for nearly all upward price momentum. In contrast, the rest of the period—close to two full years—has been characterized by slow or flat trading. Insights from both 10x Research and CryptoCon are painting a similar picture: Bitcoin is currently in a holding pattern, but momentum may be quietly gathering. With calmer markets, firm institutional demand, and familiar historical patterns, a breakout might be closer than it appears.

What links both views? A growing conviction that Bitcoin is coiling for its next decisive move. Traders are pulling back from puts and favouring call selling in a low-volatility phase. Bitcoin’s gains mostly came in brief surges after long sideways trends. Historical patterns suggest quiet consolidation often precedes fast, sharp upward price bursts. Both analysts stress that timing and patience are vital to catching Bitcoin’s next major breakout. While the market remains relatively calm, some traders are turning their attention to the months ahead—particularly September and October—as potential breakout periods for Bitcoin. Analyst Rekt Capital has noted that, based on patterns from , Bitcoin’s next major peak could occur during that timeframe. This perspective may help explain the recent positioning by traders anticipating a move to the upside.