Deep OTM Bitcoin Options Show Bullish Bet on Volatility, Not Price Direction

Traders are snapping up deep out-of-the-money (OTM) bitcoin put options in longer-dated expiries, signaling a focus on volatility rather than outright bearish bets.

On leading crypto options exchange Deribit, the $20,000 strike put for June 2026 is the second most popular option, with notional open interest exceeding $191 million. These OTM puts — strikes below the current BTC price — are cheaper than options near or above the spot price. Other active strikes for the June expiry include $30,000, $40,000, $60,000, and $75,000 puts.

While activity in deep OTM puts is often interpreted as a hedge against a market crash, the current flows tell a different story. Deribit has also seen trading in high-strike calls above $200,000. According to Sidrah Fariq, Deribit’s Global Head of Retail, this combination reflects a bullish stance on long-dated volatility rather than directional trading. “Think of it as cheap lottery tickets on a potential volatility explosion over the next six months,” Fariq told CoinDesk.

Fariq added that the $20,000 put and $230,000 call are too far from the spot price — currently near $90,500 — to act as standard hedges. Instead, these “deep wing” trades allow professional traders to position for extreme price swings and manage tail risk. If BTC moves sharply in either direction, holders of both OTM puts and calls could see asymmetric payoffs, though flat markets would erode the value of these options quickly.

Options give traders the right to buy (calls) or sell (puts) an asset at a predetermined price on or before a set date. Beyond price bets, crypto options are increasingly used by institutions to profit from volatility, time decay, and complex risk strategies, including the market tied to BlackRock’s IBIT ETF.

Overall, the options market still reflects a generally bearish tone, with BTC puts trading at a premium to calls across all tenors, according to Amberdata’s options risk reversals. This is partly driven by persistent call overwriting strategies, which boost yields on spot holdings while limiting upside exposure