Bitcoin, Ethereum August big dump warning! Put options surge, traders rush to hedge

As the market enters a critical moment in August, the risk appetite in the crypto assets market has clearly weakened. The latest data shows that Bitcoin (BTC) and Ethereum (ETH) traders are actively preparing for a potential big dump this month, with put options holdings significantly rising and hedging sentiment rapidly increasing. This article will combine options data from DeriveXYZ and Deribit to analyze the latest trends and downside risks in the BTC and ETH options market.

Bitcoin put options dominate, market bets on breaking below six digits

According to DeriveXYZ data, the number of outstanding contracts for Bitcoin put options expiring on August 29 is almost five times that of call options. Nearly 50% of the put options are concentrated at a strike price of $95,000, while another 25% are distributed in the range of $80,000 to $100,000. Deribit data also shows that the outstanding contracts for put options with strike prices of $110,000 and $95,000 exceed $2.8 billion, indicating an increasing market expectation for BTC to break below the six-figure mark.

The options skew changed from +2% to -2%, reflecting a significant increase in traders' demand for downside protection. Probability models predict that the chance of BTC returning to $100,000 before the end of the month is only 18%, further confirming the bearish sentiment in the market.

Ethereum volatility is high, and put options have a slight advantage

The Ethereum market is also experiencing a rise in bearish sentiment, although to a lesser extent than Bitcoin. Derive data shows that the number of ETH put options expiring on August 29 is approximately 10% higher than call options. The put activity is primarily concentrated at strike prices of $3,200, $3,000, and $2,200, as traders prepare for various scenarios of ETH prices ranging from moderate corrections to deep declines.

ETH 30-day skew dropped from +6% to -2%, indicating a significant increase in demand for downside protection. Ethereum's monthly volatility reached 65%, far exceeding Bitcoin's 35%, suggesting that ETH's movements may become more volatile in the coming weeks. Derive predicts a 25% chance that ETH will fall below $3,000 this month, while the probability of closing above $4,000 has risen to 30%.

Traders' hedging willingness is rising, market volatility may intensify

The bearish sentiment in the Bitcoin and Ethereum options market is heating up, reflecting traders' heightened vigilance towards the downward risks in August. As hedging demand rises, market volatility may further intensify. Investors should closely monitor the options holdings structure and the changes in key price levels, flexibly adjusting their risk management strategies.

Conclusion

In August, the risk in the crypto market intensified, with Bitcoin and Ethereum traders heavily betting on put options, as hedging sentiment dominated the market. Investors are advised to continuously monitor the dynamics of the options market and key price levels, to grasp the turning points of long and short positions, and to respond cautiously to future market trends.