Markets on Edge Bitcoin Under Pressure: As financial markets remain tense ahead of an anticipated announcement
by U.S. President Donald Trump regarding new tariffs,
cryptocurrency speculators are flocking to the options market to hedge against further price declines.

Contents

Options Market Activity

Growing Market Caution

Trade Tensions Escalate

Options Trading Reveals Traders’ Fear of Bitcoin Decline

Data from the Deribit exchange shows that put options with a strike price of $80,000
are the most traded among contracts expiring on April 4—just two days after the expected announcement.
This trend reflects the growing demand for downside protection,
as these contracts give holders the right to sell at a predetermined price.

Bitcoin dropped 4.2% to $83,637, giving up a significant portion of its recent gains.
On March 13, the cryptocurrency briefly fell below the $80,000 mark.
Other digital currencies like Ether, XRP, and Solana’s SOL also saw losses of up to 7%.

Signs of Growing Caution in the Market

Caroline Moron, co-founder of Orbit Markets,
noted that the risk reversal index,
which measures the difference between the prices of 25-delta call and put options—
reached its highest level on April 4 contracts, highlighting the dominance of bearish sentiment.

Deribit data also shows a 1.4 put-to-call ratio for contracts expiring on the same date,
indicating a clear preference for protective puts. Other markets, such as gold,
are showing similar signs of rising concern, with spot gold prices reaching a new record high above $3,080.

Augustin Fan from SignalPlus stated: “The spread between Bitcoin puts,
and calls have reached temporarily elevated levels,
indicating that traders are fully bracing for a bearish scenario soon.”

Trade Escalation Pressures Markets

In a move that added more tension to global markets,
President Trump signed an executive order to impose a 25% tariff on imported cars and auto parts,
set to take effect on April 3.
The decision raised fears of retaliatory measures that could further escalate global trade tensions.

Samer Hassan, Chief Market Analyst at XS.com,
warned that these tariffs could trigger a full-scale trade war, potentially causing broader market disruptions.

It’s worth noting that Trump’s earlier trade wins helped drive Bitcoin to a record high of $109,000 in January.
However, the ongoing impact of his trade policies,
particularly with close allies like Canada and Mexico,
has led to a market correction that erased more than 20% of Bitcoin’s value.

Markets on Edge Bitcoin Under Pressure

Markets on Edge Bitcoin Under Pressure

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