Bitcoin Options Traders Are Pricing in More Downside as IBIT Put Volume Doubles Calls on Thursday

Since Bitcoin futures touched $58,995 on Thursday, the lowest price since October 2024, the cryptocurrency's drawdown from last year's high has reached approximately 52%, according to CNBC.

Traders in the iShares Bitcoin Trust ETF (IBIT) moved aggressively Thursday. According to Cboe LiveVol data cited by CNBC, IBIT traded just shy of 1.1 million options, nearly double its 30-day average volume. Put volume crushed calls: 275,000 puts bought against roughly 129,000 calls, per data from ThinkOrSwim.

Of the $187 million in total premium traded in IBIT on Thursday, $144 million went into puts, according to SpotGamma. Of the 20 most-traded contracts by volume, 19 were puts.

The single most popular contract was the $32.50-strike put expiring Friday, a bet that needs another 4.5% slide in Bitcoin to pay off.

Implied volatility in IBIT is sitting at 53, which options market-makers are interpreting as a little over a 3% expected daily move, per CNBC.

The July 31 Odds

Pricing in the July 31 expiry contracts currently reflects about a 48% probability that IBIT falls below $30.50, a further 10% drop, between now and the end of next month, according to CNBC. The odds of a 10% rally by then are a bit higher, around 55%.

Neither outcome is a coin flip, but the put-heavy flow suggests institutional players are more willing to pay for downside protection than to position for a bounce.

Strategy Adds Fuel

Michael Saylor's Strategy, the company that turned itself into a leveraged Bitcoin proxy, is not helping sentiment. CNBC reported that 505,000 puts and 403,000 calls traded in Strategy on Thursday. Traders bought 83,000 puts, sold 72,000 calls, and bought just under 58,000 calls net.

Alexander Blume, CEO of Two Prime, an institutional Bitcoin asset manager, put it directly to CNBC: "Amidst rip-roaring AI stock performance, BTC has struggled in price and in garnering attention. The wobbly behavior of Strategy continues to scare the market, harkening back to other major blow ups the market has seen."

The comparison to prior blow-ups invokes memories of major market disruptions that linger in traders' minds.

The Case for the Other Side

The bearish options activity deserves fair framing. Put-heavy volume does not mean Bitcoin is headed lower. Options flow includes hedges from existing holders protecting positions, not just directional shorts. A long-term holder who bought IBIT at $20 and now buys $32 puts is managing risk, not calling a crash. Implied volatility at 53 is elevated but not extreme by Bitcoin's historical standards. And the July 31 odds still place a 55% probability on a 10% rally, marginally the more likely outcome.

When $144 million of $187 million in premium goes into puts, the weight of money is bearish.

Context From the Week

According to CNBC, Bitcoin has been battling with the $60,000 level all year — first in February, where it found support, then again in the first two weeks of June, before a pop to over $67,000. Thursday's futures print of $58,995 represents a fresh break below that contested level.

The most actionable near-term data point is whether that $32.50-strike IBIT put — the single most traded contract Thursday — pays off at Friday's close. If it does, it confirms the directional accuracy of Thursday's flow and may accelerate further put-buying heading into the July 31 expiry window. If Bitcoin stabilizes or bounces, a lot of that $144 million in put premium will decay quickly. Either way, the July 31 expiry is now the cleanest proxy for where institutional options traders think Bitcoin stands over the next five weeks.