The cryptocurrency market entered a defensive phase as a major options expiry on Deribit coincided with a massive liquidation event and weakening institutional demand. On January 30, 2026, 91,000 BTC options contracts expired with a notional value of $7.6 billion, alongside 435,000 ETH options worth $1.19 billion. The total expiring notional value reached approximately $9 billion, representing about 25% of open interest.
The data revealed a bearish tilt, with a low BTC put-call ratio of 0.48 and a maximum pain point at $90,000. Call option dominance and a shift in downside protection from the $85,000 to the $80,000 level indicated traders were actively hedging against further declines. This sentiment was mirrored in Ethereum, which had a put-call ratio of 0.68.
This cautious positioning unfolded against a backdrop of severe market stress. Bitcoin's price slid from around $84,400 into the low-$81,000s, triggering a liquidation wave of roughly $1.7 billion in leveraged positions. The decline was characterized by sharp, stair-step moves, exacerbated by thinning spot liquidity.
A critical driver of the weakness was a significant reversal in U.S. spot Bitcoin ETF flows. After a small inflow of $6.8 million on January 26, the ETF complex saw four consecutive days of outflows totaling approximately -$978 million. The outflow on January 29 alone was -$817.8 million, nearly 8 times the average daily flow, with major outflows from IBIT (-$317.8M), FBTC (-$168.0M), and GBTC (-$119.4M). This shift turned a key source of institutional demand into a net supply.
Market sentiment was further pressured by macro-political concerns, including the potential appointment of Kevin Warsh as Federal Reserve Chair, which traders interpreted as a signal for tighter future financial conditions. The volatility spike was confirmed by Deribit's DVOL (30-day implied volatility index), which surged from 37 to above 44, its largest jump since November 2025.
Following the expiry, Bitcoin traded at $82,252.43, holding above the key $80,000 support, while Ethereum traded at $2,717.77. The market sentiment gauge registered "extreme fear," with Bitcoin down 3.35% for January and facing a 30% drawdown from its peak.
