Bitcoin’s slide below $68,000 heightens risk of a deeper drop toward $60,000

Bitcoin’s slip below $68,000 could carry outsized downside risk as options market positioning sets up conditions for a self-reinforcing sell-off.

Renewed geopolitical tensions, sparked by President Donald Trump’s tougher stance on Iran, have pushed bitcoin down roughly 2% over the past 24 hours to around $67,000. While the move may appear modest on the surface, underlying market structure suggests growing fragility.

A key factor lies in activity on the Deribit options market, where traders have increasingly accumulated downside protection. In recent weeks, there has been a notable build-up of put options clustered below current price levels, with strikes ranging from $68,000 down to the mid-$50,000s. This positioning reflects broader macro uncertainty, including geopolitical risks, emerging technological threats, and lingering effects from last year’s bear market.

However, such defensive positioning can create what is known as a “negative gamma” environment. In this setup, market makers—who take the opposite side of trades to provide liquidity—are forced to adjust their exposure in ways that amplify prevailing price trends. In a declining market, this dynamic can accelerate losses.

Data from Glassnode indicates that dealer gamma exposure is largely negative between $68,000 and $50,000, a direct result of traders holding long put positions while dealers are effectively short those options. As prices fall below $68,000, dealers incur losses and typically hedge by shorting bitcoin, adding further selling pressure.

This hedging activity can trigger a feedback loop, where falling prices prompt more hedging, which in turn drives prices even lower. Historically, such dynamics have intensified both upward and downward moves.

That’s why the recent break below $68,000 is seen as a critical threshold. Beyond signaling technical weakness, it opens the door to a zone where forced selling could accelerate.

“Negative gamma is now building just below current price levels, from $68K down into the high-$50K range,” Glassnode noted in its latest report. “A move into this zone could lead to accelerated selling as hedging flows reinforce downside momentum, potentially driving a sharper repricing toward the $60,000 level.”

Market conditions may further exacerbate the risk. Liquidity remains relatively thin following the March 27 options expiry and is expected to stay subdued over the Easter holiday period, leaving fewer buyers to absorb selling pressure.

If this feedback loop fully develops, the decline could extend well below $60,000.

While bitcoin’s recent weakness has been driven in part by geopolitical headlines, this setup highlights how internal market mechanics can play an equally important role. Holding above $68,000 could allow the market to stabilize, but a sustained move lower risks triggering a cascade of selling that could turn a routine pullback into a deeper correction.