Short-Term Bullish Sentiment Strengthens in Bitcoin Options: Hedging Costs at Yearly Lows

The 25-delta skew in Bitcoin options has dropped to its lowest level of the year across all maturities and turned negative for 1-week and 1-month expirations; investors are paying higher premiums for short-term bullish exposure.

According to data shared by Glassnode, following Bitcoin’s recent breakout, the volatility of call options has exceeded that of put options across all maturities. This scenario indicates that investors prefer exposure to upside movement rather than hedging against a decline.

An option is a contract that gives the right to buy or sell Bitcoin at a specific price. 25-delta skew measures the relative price of bullish call options and bearish protective put options for the same maturity. A decline in this indicator suggests that call options are becoming more expensive compared to puts. The skew falling below zero for the 1-week and 1-month maturities, known as the front end, reveals that short-term bullish exposure has taken the lead.

Bitcoin Investors Are Paying Premiums for Short-Term Upside

The shared chart shows the most dramatic shift in short-term contracts. The 1-week skew fell to approximately minus 10%, while the 1-month measurement dropped below zero. Although 3 and 6-month maturities remain in positive territory, they have also hit their lowest levels of the year.

This pricing does not guarantee that Bitcoin’s price will rise. It only indicates that investors are paying more today for a potential rally. If bullish expectations fail to materialize, the premiums paid for call options could lose value rapidly.