Bitcoin options flash extreme fear as downside hedging costs hit record highs, VanEck says

Despite signs of stabilization in spot prices, sentiment across the bitcoin market remains cautious, with investors pulling back on leverage and volatility cooling.

According to VanEck’s mid-March 2026 Bitcoin ChainCheck report, traders are paying record premiums for downside protection—highlighting a defensive stance even as prices steady.

The report notes that bitcoin’s 30-day average price declined 19% compared to the previous period, while realized volatility dropped sharply from around 80 to just above 50. At the same time, futures funding rates eased to 2.7% from 4.1%, pointing to a slowdown in leveraged speculation.

Options data reinforces the cautious outlook. VanEck found the put/call open interest ratio averaged 0.77 and reached a peak of 0.84—its highest level since June 2021, during the China Bitcoin mining crackdown.

Over the past 30 days, traders spent roughly $685 million on put options, while call option premiums declined 12% to about $562 million. Relative to spot trading volumes, put premiums climbed to around 4 basis points—an all-time high in VanEck’s dataset.

The firm noted that this level is roughly three times higher than what was observed in mid-2022 following the Terra/Luna collapse and the Ethereum staking liquidity crisis.

However, VanEck emphasized that such extreme bearish positioning has historically aligned more with market bottoms than further declines. Over the past six years, similar spikes in options skew have been followed by average bitcoin gains of 13% over 90 days and 133% over 360 days.

The report also highlighted that on-chain activity remains subdued, while selling pressure from miners appears to be relatively contained.