Bitcoin Market Faces Downward Skew Amid Geopolitical Tensions

BlockBeats News reported that traders on Derive.xyz predict a 30% chance of Bitcoin falling below $80,000 by June 2023 amidst escalating US-European geopolitical tensions.

This probability reflects heightened market volatility concerns, influencing Bitcoin’s price drop to $91,000 as traders anticipate potential further declines and hedging through options market activity.

Geopolitical Tensions Impact Bitcoin Price Trajectory

The geopolitical issue involving the U.S. and Europe over Greenland has prompted economic anxieties, potentially leading to a 10% tariff on imports from related European countries. Concerns arose as Bitcoin’s price fell from $95,000 to $91,000 following these tensions. Dr. Sean Dawson underscores the 30% probability of Bitcoin dropping below $80,000 by late June. He linked this outlook to the negative skew observed in the options market, indicating a possible steep fall in cryptocurrency valuations.

The immediate implications of these tensions include the reallocation of market positions as traders brace for possible fluctuations. This is highlighted by the heightened opening of interest in put options on platforms like DeriveXYZ, focusing on strike prices between $75,000 and $80,000. The option skew indicator points towards modest next-quarter expectations.

The escalation of geopolitical tensions between the U.S. and Europe (especially regarding the Greenland dispute) has increased the systemic transition risk of market return to a high-volatility environment, a dynamic that has not yet been fully reflected in the current spot price.” — Dr. Sean Dawson, Research Director, Derive.xyz

Bitcoin’s Decline Linked to Volatile Global Relations

Did you know? In past events, geopolitical tensions notably impacted crypto market stability, mirroring shifts in trader sentiment today as options markets signal a defensive positioning similar to the 2025 crisis.

Bitcoin (BTC) is trading at $90,623.09 and holds a market cap of $1.81 trillion, reflecting a 59.03% market dominance. The trading volume in the last 24 hours amounts to $34.51 billion, marking a 13.27% decline since the previous day. BTC has seen a 2.66% price decrease over the past 24 hours, depicting a negative trend since geopolitical concerns arose. This data is sourced from CoinMarketCap.

The Coincu research team outlines that the ongoing geopolitical tensions may heighten the chances of broader market volatility in the near term. With historical precedents showing similar impacts during periods of elevated geopolitical stress, the market might prepare for a potential increase in risk aversion and defensive strategies.