Bitcoin Options Market Sees Most Extreme Defensive Positioning Since FTX Collapse

The Bitcoin options market has reached its most defensive positioning since the FTX collapse in November 2022, according to Binance Research's weekly report. This extreme hedging appears disproportionate, suggesting the market may be closer to a sentiment trough than a precipice.

Binance notes that there is no equivalent fundamental shock: no major exchange collapse, no regulatory crisis, and no systemic failure. The current environment has led to the BTC options 25-delta skew index hitting its most negative reading since November 2022.

The divergence between Bitcoin and rising global M2 money supply has now extended beyond any prior episode in the dataset's history. Binance analysts attribute this to three overlapping structural distortions: dollar weakness mechanically inflating the dollar-denominated M2 aggregate, the post-ETF institutional ownership structure classifying BTC alongside software equities, and elevated real interest rates keeping large liquidity pools parked in money market funds.