Analysis: The derivatives market reflects a reversal of bearish sentiment towards Bitcoin, with demand for long positions on the rise.

On November 27, Bloomberg reported that although Bitcoin has seen a price pullback of up to 36% since reaching an all-time high in early October, its implied volatility remains at a relatively manageable level. This change reflects that as Bitcoin gradually moves towards institutionalization, its risk transmission methods are being reshaped. In the early stages, Bitcoin's value was primarily driven by speculative traders attempting to profit from its frequent and large price fluctuations. The overall derivatives market indicates a reversal of bearish sentiment. According to Coinglass data, the demand for long positions in the Bitcoin perpetual futures market, a high-leverage trading market commonly used by crypto traders, is currently rising, while the scale of open interest remains at a relatively mild level. The positive funding rate of related contracts indicates that bullish bets have regained dominance after dipping into negative territory earlier this week. CEX data shows that the open interest for call options with a strike price of $100,000 is the highest, while the previous week, the market was primarily focused on downward protection around $80,000 and $85,000. GSR OTC trading head Spencer Hallarn stated, “In the past few weeks, speculative long positions have significantly decreased, as evidenced by the decline in perpetual futures open interest and funding rates. This has also prepared the crypto market for the next round of pump.”