Summary
TLDR: Despite strong demand for bitcoin and inflows into ETFs suggesting a continued price increase, some traders are preparing for a sharp decline by purchasing options to sell at lower prices due to signs of an overheated market and potential correction of over 10%.
Key Points
1. Traders are starting to position for a potential sharp decline in Bitcoin by purchasing put options at strike prices below the current market rate.
2. Perpetual funding rates suggest that the market may be overheated, leading some traders to anticipate a correction of more than 10%.
3. Despite strong inflows into U.S.-based ETFs and the recent halving event, there is a consensus that there is a supply-demand imbalance which could drive Bitcoin’s price higher.