Bitcoin Traders Ramp Up Downside Protection Following Fed Rate Cut: Deribit Analysis

Fed cuts rates—Bitcoin traders brace for impact. The latest move from the Federal Reserve has crypto markets hedging harder than ever.

Options activity spikes as uncertainty looms

Traders on Deribit are loading up on put options, betting big on downside moves. It’s not panic—it’s preparation. When traditional finance zigzags, crypto doesn’t just watch; it positions.

Volatility becomes the real asset

Rate cuts used to mean rocket fuel for risk assets. Not this time. The smart money isn’t waiting around for a rally—it’s buying insurance. Because in crypto, hope isn’t a strategy; delta is.

Another day, another dose of reality from the folks who still think monetary policy is a precision instrument. Meanwhile, Bitcoin traders do what they do best: adapt, hedge, and outmaneuver.

Currently, the seven, 30, 60, and 90 day skews are slightly negative, with the 180 day skew neutral, according to data source Amberdata.

This indicates persistent concerns about a possible BTC correction.

Investors buying puts may be concerned that the Fed’s easing was already factored into the market ahead of the decision and that a deteriorating economic outlook could reduce demand for riskier assets, such as bitcoin.

"After the Fed’s decision, some of the earlier Optimism has faded. The market now seems to be waiting for the next catalyst — whether macro or crypto-specific — to break the stalemate and push option positioning out of its current balance between caution and optimism," Strijers said.

Sidrah Fariq, global head of retail sales and business development at Deribit, said the persistent put bias represents market maturity.

"In some sense, BTC options are behaving more like S&P index options - a sign of maturity, but also of market caution," Fariq said.

Additionally, traders writing covered calls – selling call options against their spot holdings to collect premium – which may be contributing to the put bias, particularly in longer-dated options. This strategy generates additional income but can cap upside potential.

Covered call has emerged as a popular strategy among BTC, ETH and XRP traders in recent years.