Bitcoin Derivatives Flash Warning as Fed Liquidity Fails to Lift $100K Outlook

Key Takeaways

• BTC derivatives imply weak confidence in a move above $100,000, reflecting macro uncertainty and Bitcoin’s underperformance against gold.

• Whales and market makers remain defensive, even as the Federal Reserve injects liquidity through short-dated bond purchases.

• Bitcoin trades around $90,088, but options pricing suggests a 70% probability that BTC stays below $100,000 by Jan. 30.

Bitcoin Faces Rising Skepticism Despite Fed Liquidity Boost

Bitcoin derivatives traders are turning increasingly cautious, even as the U.S. Federal Reserve shifts toward a more expansionary stance. While the Fed’s policy pivot typically lifts risk assets, options markets are signaling that BTC may struggle to regain strong bullish momentum.

At roughly $90,088, Bitcoin continues to lag behind gold—a trend that has weighed on sentiment among institutional traders.

Gold price reference

Fed Holds Rates—but Announces a Major Liquidity Injection

On Wednesday, the Federal Reserve held its benchmark rate at 3.75%, a move markets largely anticipated. But the real headline was the Fed’s announcement of a $40 billion program to purchase short-dated U.S. Treasurys.

This marks a meaningful reversal from years of balance-sheet tightening, which shrank Fed assets from $9 trillion in 2022 to about $6.6 trillion today.

Powell emphasized labor market softness and persistent inflation risks, noting that two FOMC members even preferred to hold rates at 4%—an unusually large split for the committee.

The fresh liquidity should increase bank lending capacity and support credit growth. Yet Bitcoin traders remain doubtful that this will translate into immediate upside for BTC.

Bitcoin Options Pricing Shows 70% Odds BTC Stays Under $100K

According to options data from Laevitas (http://laevitas.ch/), the market assigns a 70% probability that Bitcoin will remain at or below $100,000 by Jan. 30.

• The $100K call option—giving buyers the right to purchase BTC at the strike price—costs $3,440, significantly lower than the $12,700 premium seen just one month ago.

• Lower premiums reflect waning demand for high-strike upside.

• The January options expiry falls two days after the next FOMC meeting on Jan. 28, adding another layer of uncertainty.

Meanwhile, the CME FedWatch Tool assigns only a 24% probability of another rate cut in January. The recent U.S. government shutdown in November also disrupted economic data releases, limiting trader visibility on key indicators.

Stocks Respond More Clearly to Fed Easing Than Bitcoin

The Federal Reserve’s expansionary stance has generally benefited equities more than crypto:

• S&P 500 has risen 13% over the past six months.

• 5-year Treasury yields have fallen from 4.1% to 3.72%, lowering borrowing costs.

• Companies expect cheaper financing and better access to credit.

Bitcoin, however, behaves less predictably. Investors exiting short-term bonds don’t necessarily view BTC as a safe or stable alternative, especially when macro risks remain elevated.

This helps explain why BTC continues to lag behind gold, which has seen renewed interest as U.S. debt levels rise.

What Could Trigger a Bitcoin Breakout?

The catalysts for a significant BTC rally remain unclear. Some traders suggest that:

• Growing default risk in the AI sector

• A potential shift out of overextended equities

• Renewed institutional flows after the January FOMC meeting

could redirect capital toward Bitcoin.

But for now, whales remain defensive, and market makers show little appetite for chasing upside beyond $100K.

Market Outlook: Cautious Until Proven Otherwise

Despite the Fed reintroducing liquidity, the derivatives market paints a restrained picture for Bitcoin’s short-term prospects.

With options pricing heavily skewed toward BTC staying under $100,000, traders appear unconvinced that the current macro backdrop is strong enough to support a decisive breakout.

Until economic uncertainty clears—and until Bitcoin starts outperforming gold—professional traders are positioning for stability, not euphoria.

See all our insights: Bitcoin World News