Bitcoin Traders Snap Up Deep OTM Options as Volatility Bets Surge Into 2026

Deep out-of-the-money (OTM) bitcoin put options are gaining remarkable traction across longer-dated expiries, signaling that traders are positioning for potentially explosive volatility rather than a straightforward price crash. On Deribit, the world’s leading crypto options exchange, the $20,000 strike put for the June 2026 expiry has become the second most actively held contract, with more than $191 million in notional open interest. Notional open interest reflects the total dollar value of active contracts, and OTM puts—priced below Bitcoin’s current market value—tend to be inexpensive compared to options closer to spot levels.

The June expiry also shows heavy activity in other OTM puts at the $30,000, $40,000, $60,000, and $75,000 levels. While deep OTM put buying is often interpreted as hedging against a severe market decline, Deribit’s order flow suggests a more nuanced narrative. Traders are simultaneously targeting extremely high-strike calls above $200,000, indicating that market participants are seeking low-cost exposure to both tails of the volatility curve.

According to Deribit’s Global Head of Retail, Sidrah Fariq, this trend reflects a broader bullish sentiment on long-dated volatility rather than a directional bet. She explained that professionals are employing “deep wing” strategies—using far-from-spot options to cheaply express volatility views and fine-tune tail risk. With BTC trading around $90,500 at the time of writing, neither a $20,000 put nor a $230,000 call is realistically positioned as a simple hedge, reinforcing the idea that traders are targeting potential extreme moves in either direction.

Holding both OTM calls and puts can create asymmetric returns if Bitcoin experiences sudden and significant price swings. However, if the market remains stagnant, these contracts rapidly lose value due to time decay. As institutions continue using options to navigate price action, volatility, and risk management—particularly through products like BlackRock’s IBIT ETF—the crypto derivatives landscape is becoming increasingly sophisticated.

Despite this surge in volatility-focused strategies, market sentiment skews slightly bearish overall. Data from Amberdata shows BTC puts trading at a premium to calls across multiple expiries, partly driven by widespread call-overwriting strategies traders use to generate additional yield.