Options traders are betting that Bitcoin's (CRYPTO: $BTC) price will fall as low as $52,000 U.S. in coming weeks.
BTC is currently trading at $62,500 U.S., having fallen from $65,000 U.S. earlier in the week and down from an all-time high of $126,000 U.S. reached last October.
Options traders have turned bearish and are now placing bets that the largest cryptocurrency has further to fall and that its price could slide all the way to $52,000 U.S.
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Market data shows that a growing number of traders are buying put options that would deliver big payouts if Bitcoin's price falls to $52,000 U.S. by the end of July.
Crypto exchange Deribit is seeing heavy buying of near dated put options with expirations from June 22 to July 31.
Those bets see Bitcoin's price at $60,000 U.S. at the start of July, dropping to $55,000 U.S. by July 10, and trading at $52,000 U.S. at the end of next month.
A put option is a bet that an asset's price will decline a certain amount by a set date. The latest positioning by options traders indicates extremely bearish sentiment, says Deribit.
Analysts note that enthusiasm for cryptocurrencies has soured after the U.S. Federal Reserve indicated that it is likely to raise interest rates in this year's second half.
Higher interest rates are typically negative for risk assets such as Bitcoin.