Bitcoin trading risks intensify: Deribit $28.5 billion options settlement draws market attention

The cryptocurrency derivatives market has recently experienced a critical moment. A super settlement day at Deribit, the world’s largest crypto derivatives exchange, pushed Bitcoin and Ethereum options contracts worth $28.5 billion into the spotlight. This settlement not only tested the market’s resilience under pressure but also reflected traders’ complex sentiment towards the current market conditions.

According to Jean-David Pequignot, Chief Commercial Officer at Deribit, the total value of contracts expiring this time accounts for more than half of the platform’s open interest of $52.2 billion, setting a new record high. He pointed out that year-end settlements symbolize the conclusion of an entire year’s cycle, and the market’s core characteristics have shifted from previous speculative cycles to a more institutional, policy-driven “super cycle.”

Bitcoin Price Fluctuates Repeatedly Under Pressure

Bitcoin’s performance during this period has been quite dramatic. After briefly touching $90,000, the market was unable to sustain the rally and entered a retracement. According to the latest data, Bitcoin’s current price hovers around $90.29K, with a 24-hour change of +0.34%. This oscillating price movement vividly illustrates the real battle between bulls and bears at key levels.

Previously, Bitcoin fluctuated within the $85,000 to $90,000 range, mainly due to market participants’ caution ahead of the upcoming settlement day. Once contracts expire, these accumulated positions are inevitably subject to liquidation pressure, which ultimately reflects in the spot price.

Market Risks from Deribit Options Structure

Market participants are most concerned about the “maximum pain point”—a key indicator indicating the strike price most likely to be approached by the underlying asset before expiration. Based on current data, Bitcoin’s maximum pain point is at $96,000. However, the real risk to watch out for is the put options with a strike price of $85,000.

Pequignot warned that these positions have an open interest of up to $1.2 billion. If the market moves to this level, these positions could act as catalysts for further downward price movement. This is a typical manifestation of the “risk concentration” phenomenon in derivatives markets—large positions clustered at specific price levels, creating hidden support or resistance.

Traders’ Dual Strategies: The Tug-of-War Between Bulls and Bears

While downward risks are prominent, bulls have not completely retreated. There are still strategies like call spreads locking in the $100,000 to $125,000 range, indicating that traders remain bullish on medium to long-term prospects. However, the short-term hedging costs have risen significantly, reflecting heightened market vigilance against recent volatility.

This phenomenon reveals a deeper logic in Bitcoin trading: traders are hedging across different time horizons. They are adopting defensive positions in the short term while maintaining aggressive positions in the medium term, demonstrating sophisticated risk management across multiple timeframes.

The Wisdom Behind Roll-Over Strategies and Risk Management

The most noteworthy aspect is traders’ “roll-over” strategies. Instead of rushing to close defensive positions, traders are shifting their holdings from December expiries with strike prices between $85,000 and $70,000 to January expiries with strike prices between $80,000 and $75,000 in put spreads.

The underlying logic is that market participants have taken basic protections against short-term risks before the year’s end but remain highly aware of potential market movements in early 2026. In other words, traders are not bearish on the long-term outlook but are employing a “rolling risk management” approach—continuously pushing risk positions forward to adapt to evolving market dynamics.

Insights for Bitcoin Traders

This Deribit options settlement event offers several key lessons for Bitcoin traders:

First, large contract expiries often accompany increased price volatility, so traders should heighten risk awareness during these periods.

Second, the concentration points of positions in derivatives markets often serve as support or resistance levels; understanding these key levels can improve trading decisions.

Third, the multi-timeframe hedging strategies employed by professional traders indicate that analysis based on a single timeframe is insufficient. Bitcoin trading requires coordinated risk management across short, medium, and long-term horizons.

Finally, the roll-over strategies suggest that the market remains cautious about the early 2026 outlook, providing important references for subsequent Bitcoin trading strategy adjustments.

Overall, although this super settlement at Deribit has concluded, the market structure, trading psychology, and risk management approaches it reflects continue to hold lasting significance. For market participants involved in Bitcoin trading, understanding these deeper logics will help make more informed decisions amid complex and volatile markets.