Two leading indicators warn, Bitcoin sentiment is "panic-stricken"

Demand for put options surges, miners begin to sell off.

Written by: Long Yue

Source: Wallstreetcn

The bitcoin market is facing dual pressure. Data from the options market shows a surge in demand for put options, with traders willing to pay higher premiums to hedge against downside risk. At the same time, bitcoin miners have deposited about 51,000 bitcoins to exchanges over the past week, reaching the highest level in months, possibly preparing for potential sales. "When miners start selling, the market usually doesn't end well."

Amid recent sharp fluctuations in bitcoin prices, two key leading indicators from the options market and on-chain miner activity are sending increasingly strong warning signals.

The latest market dynamics show that traders are preparing for potentially more downside risk. According to a report by Cointelegraph today, a key indicator in the bitcoin options market, "delta skew," has risen above 10%, indicating that professional traders are buying put options at a premium. This is typically seen as a classic signal of bearish market sentiment.

Meanwhile, the actions of miners have also raised market concerns. According to CryptoQuant data, since October 9, miner addresses have deposited about 51,000 bitcoins to Binance. This is the largest inflow to exchanges since July, and historically, such behavior often occurs before price weakness.

The simultaneous deterioration of these two major indicators has directly led to a rise in risk aversion and poses a severe test to bitcoin's price support levels. On Thursday, bitcoin's price briefly fell to $107,600 (UTC+8).

Options Market Flashes Red, Bearish Bets Surge

Data from the derivatives market clearly reflects traders' growing concerns.

According to laevitas.ch data, the bitcoin 30-day options delta skew indicator, which measures professional trader sentiment, has broken above 10%, significantly higher than the neutral range of -6% to +6%. This indicates that market participants are willing to pay a higher cost to buy put options to hedge against price declines.

In addition, the demand for downside protection strategies is confirmed by trading volume. According to reports, on Thursday at Deribit, the trading volume of put options was 50% higher than that of call options, with this indicator climbing to its highest level in over 30 days.

This signals that market pressure is building, as under normal circumstances, cryptocurrency traders tend to be optimistic, and the put/call options ratio is usually lower.

Large-Scale Miner Transfers, Historical Signals of Selling Pressure

In addition to signals from the derivatives market, the actions of one of the most critical participants in the bitcoin ecosystem—miners—are also adding uncertainty to the market.

CryptoQuant data shows that in the seven days since October 9, miner addresses transferred 51,000 bitcoins to Binance, valued at over $5.7 billion. Of these, on October 11 (UTC+8) alone, miners deposited more than 14,000 bitcoins to Binance, which occurred the day after the recent "crypto market liquidation." This scale is also the largest since July last year.

CryptoQuant pointed out in a report on Thursday that when miners transfer bitcoin from wallets used for storage or mining to trading platforms, it usually means they may be preparing to sell or hedge.

The report emphasized that although these transfers may also be for collateral, financing, or operational reasons, historical experience shows that when miners start selling, the market usually doesn't end well.

This shift in sentiment from "holding" to "selling" has historically put pressure on bitcoin prices and is often a precursor to significant price corrections.

Bitcoin miners have shifted from holders to sellers, and historically, this has signaled dramatic changes in bitcoin prices and market sentiment.