Key takeaways:

• Bitcoin derivatives are signaling caution, with options bias reaching 20% ​​as investors fear another wave of fund liquidations.

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• Bitcoin’s price has recovered some of Thursday’s losses but is still struggling to match gains in gold or tech stocks amid low demand for leverage.

Bitcoin (BTC) is up 17% from Friday’s low of $60,150, but derivatives indicators suggest caution as demand for bullish price exposure near $70,000 remains subdued. Traders fear that the liquidation of $1.8 billion in leveraged bullish futures contracts in five days indicates that major hedge funds or market makers may have blown up.

Unlike the market crash of October 10, 2025, which culminated in a record $4.65 billion liquidation of Bitcoin futures contracts, the recent price weakness has been marked by three consecutive weeks of downward pressure. Bulls increased positions from $70,000 to $90,000 as aggregate interest in open futures increased despite contracts being forced to liquidate due to insufficient margins.

Aggregate interest in open Bitcoin futures on major exchanges amounted to 527,850 BTC on Friday, virtually unchanged compared to the previous week. Although the face value of these contracts dropped to $35.8 billion from $44.3 billion, the 20% change perfectly reflects the 21% decline in Bitcoin’s price over a seven-day period. The data shows that bulls are adding positions despite the steady decline in prices.

To better understand whether whales and market makers have moved to the bullish position, it is crucial to evaluate the BTC futures base rate, which measures the price difference compared to regular spot contracts. In neutral circumstances, the contribution should be between 5% and 10% on an annual basis to compensate for the longer settlement period.

The benchmark BTC futures rate fell to 2% on Friday, the lowest level in over a year. The lack of demand for bullish leverage is to some extent to be expected, but it will take longer for bulls than users to regain confidence even when Bitcoin’s price exceeds $70,000, especially considering BTC is still 44% below its all-time high.

Bitcoin derivatives indicators signal extreme fear

Traders’ lack of confidence in Bitcoin is also perceptible in the BTC options markets. Excess demand for puts (puts) is a forceful bearish indicator, pushing the skewness index above 6%. Conversely, when fear of loss occurs, investors will pay a premium for call (call) options, causing the skewness metric to turn negative.

The BTC options skew rate hit 20% on Friday, a level that rarely holds and usually signals market panic. For comparison, on November 21, 2025, the skewness rate was 11%, following a 28% price correction to $80,620 from a high of $111,177 reached 20 days earlier. With no specific catalyst for the current downturn, fear and uncertainty have naturally intensified.

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Traders will likely continue to speculate that a major market maker, exchange-traded fund or hedge fund may have gone bankrupt, a sentiment that undermines belief and implies a high likelihood of further price declines. As such, the chances of the bullish trend continuing remain low while BTC derivatives indicators continue to signal extreme fear.