Bitcoin options volatility surge drives market restructuring

Bitcoin faces a continued rise in volatility. Last year, just before $28 billion worth of Bitcoin options expired, this surge in volatility drew widespread market attention. At that time, Bitcoin soared from $88,500 to $89,100, then fluctuated around $88,500, demonstrating high instability. Experts analyze that the rising volatility reflects market repositioning ahead of options expiration, and investors should stay alert in such high-volatility environments.

Volatility surges before options expiration, short covering pushes prices higher

During this period at the end of last year, crypto analyst Ardi pointed out that Bitcoin’s rise to $89,100 coincided with a major short covering phase. According to analysis, this rally occurred in two stages: the first driven mainly by short covering without genuine buying support; the second showing real buying strength, with high-volume buyers entering the market, which is the true reason behind the increased volatility.

At that time, 24-hour trading volume surged 36% to $30 billion, reflecting traders’ bullish sentiment. This shift in sentiment directly boosted market volatility. However, Ardi also warned that this volatility has not yet confirmed a sustained bullish reversal; only if Bitcoin reclaims the key level of $94,000 can volatility turn into a bullish signal. Until then, short-term pullback risks remain.

Technical pressure and rising volatility risk

Analyst Ardi noted that due to record-breaking options expiry volumes, such events often lead to intense market swings afterward. The rise in volatility not only reflects differing market opinions but also suggests an increased likelihood of large two-way price movements.

Another well-known analyst, Daan Crypto Trades, from a technical perspective, pointed out that Bitcoin is entering a price compression phase. He observed that lows are gradually rising, and the 4-hour 200MA/EMA is forming clear resistance. This increasingly tight price action typically signals imminent volatility release. Daan expects significant one-sided moves of 5-10% in the coming weeks, with volatility potentially reaching a critical breakout point in January.

Diverging outlooks on Bitcoin’s future, January as a key turning point

Two analysts have subtle differences in their technical outlooks for Bitcoin. Ardi emphasizes waiting for a confirmed breakout above $94,000 before declaring a trend reversal; Daan is more optimistic, believing that if this resistance is successfully broken, Bitcoin could rebound to $100,000 or higher.

Regarding downside risks, Daan warns that $80,000 is another critical support level; a break below this could drastically reverse the market outlook. Analysts generally agree that January will be a pivotal period for determining Bitcoin’s next major trend. From last year’s expectations, the market experienced a period of high volatility adjustment, and currently, Bitcoin has fallen back to $70,940 (as of March 2026), down nearly 21% from the end of last year, confirming the real impact of volatility risk.

Market participants should recognize that options expiries during periods of surging volatility act as catalysts, but the true buying and selling forces are key to determining long-term direction. In times of high volatility, setting clear entry and exit signals becomes especially important.