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Bitcoin risks ending 2025 in negative territory unless it closes above $94,000 by New Year’s Eve. The asset has declined 5.7% this year after weak Christmas trading, even as U.S. equities reached new highs. The muted performance has shaped near-term caution. Traders have grown wary that soft price action could extend into early January, with derivative and ETF data reflecting defensive positioning across markets.
Can Bitcoin regain momentum as liquidity returns, or will caution continue to shape positioning into the new year?
Bitcoin options markets showed shifting sentiment through late December, based on data shared by Laevitas on X. The chart tracks Deribit 25-delta risk reversals from December 14 to December 28. Across all tenors, risk reversals remained negative. Put options traded at higher implied volatility than calls, showing sustained demand for downside protection despite a gradual improvement in skew.
Short-dated contracts led the change. Longer-dated tenors moved more slowly, signaling that near-term risk perceptions eased first while broader caution stayed intact.
The one-week 25-delta risk reversal recorded the largest swings. Early readings dipped below −6 vols, reflecting heavy short-term hedging during mid-December volatility. As conditions stabilized, the one-week skew climbed toward −0.2 vols. Analysts linked the move to reduced urgency for protection as near-term fears cooled.
That shift reversed when Bitcoin failed to hold above $88,000. The one-week risk reversal slipped back near −1.6 vols, showing renewed short-term hedging as momentum stalled.
Medium-dated options improved steadily. One-month through three-month risk reversals rose from near −5 vols toward the −3 to −4 range, while six-month skews also improved but stayed negative. Long-dated sentiment changed least.
One-year risk reversals hovered near −3 vols, indicating longer-term downside risk pricing remained in place. ETF data echoed caution. Analyst Maartunn reported the largest Bitcoin ETF drawdown since launch, with outflows totaling −$5.55 billion from the all-time high.
The drawdown coincided with late-2025 price weakness. According to QCP Capital, open interest fell by about 50% after the December 26 expiry, leaving capital sidelined and direction tied to the return of liquidity.
Also Read: Why Bitcoin is a Better Alternative to Gold: 4 Key Reasons
Bitcoin approaches year-end under pressure, with price weakness persisting, options skews remaining negative, and ETF outflows reaching record levels. Short-term sentiment has improved only briefly. Until liquidity returns and positioning rebuilds, traders remain cautious, and market direction stays uncertain.
