Deep Out of the Money (OTM) Bitcoin BTC$89,954.33 Put option expirations are getting longer as traders take advantage of cheap lottery tickets for moonshot profits in the event of a wild swing in BTC.
On leading crypto options exchange Deribit, the $20,000 exercise put is the second most popular option expiring in June 2026, with over $191 million in nominal open interest.
Notional open interest is the dollar value of the number of active contracts. A put option with a strike price below the market rate of BTC is said to be OTM. These OTM puts tend to be cheaper than puts near or above BTC’s spot price.
Other OTM puts are also seeing big moves at June expirations with strikes at $30,000, $40,000, $60,000, and $75,000.
Deep OTM put activity is usually interpreted as traders preparing for a price crash. However, this is not necessarily the case as the exchange is also seeing higher exercise call activity above $200,000.
Sidra Farik, global head of retail at Deribit, said these flows represent a bullish view on long-term volatility at low cost, rather than bets on the direction of prices. Think of this as a cheap lottery ticket for the potential explosion of volatility over the next six months.
“There is approximately 2,117 open interest on a $20,000 Bitcoin input expiring in June. We also saw large trades with a $30,000 put and a $230,000 call strike. These out-of-the-money option combinations do not suggest directional trades, but rather deep wing trades, which professionals use to trade long-term volatility cheaply and adjust for tail risk on their books,” Farik told CoinDesk.
She explained that a $20,000 put or $230,000 call is essentially volatility positioning rather than price positioning because it is too far from the spot price to be a purely protective hedge. At the time of writing, BTC was trading near $90,500, according to CoinDesk data.
Those who hold both OTM calls and puts may derive asymmetric benefits from extreme volatility or wild price movements in either direction. However, if the market is flat, these options quickly lose value.
An option is a derivative contract that gives the buyer the right to buy or sell the underlying asset at a specified price at a later date. A put option provides the right to sell and represents a bearish bet on the market. Once you make the call, you will be given the right to purchase.
The crypto options market, including those associated with BlackRock’s IBIT ETF, has evolved into a sophisticated field where institutions and whales play a game of three-dimensional chess to manage risk and profit from changes in price direction, time decay, and volatility.
Broadly speaking, the mood in the options market appears to be bearish, as BTC puts continue to trade at a premium to calls across all periods, according to Amber Data’s Option Risk Reversal. This is at least partially due to persistent call overwriting, a strategy aimed at increasing yields on top of spot market holdings.
