BTC breaches $82K while derivatives flag mixed signals
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After a double-digit rally in April, Bitcoin has continued its ascent, even briefly trading past $82K — its highest level since end-January.
As such, Block Scholes’ Risk Appetite Indices for both BTC and ETH have surged past a value of 1 and into a region that has typically marked further bullish price momentum.
Since 2021, BTC has rallied by about 12% on a monthly basis on 17 occasions, 9 of which were followed by a 2nd month of higher spot prices.
However, despite a backdrop of easing geopolitical tensions and a major crypto bill in the "red zone", derivatives markets are sending mixed signals.
Open interest in perpetual futures contracts is close to a 30-day high, suggesting some appetite among traders to open leveraged positions, while funding rates briefly spiked amid the spot breakout past $80K.
Options markets, by contrast, show a more cautious outlook: volatility smiles continue to trade with a small put premium.
Bitcoin hits 3-month high
BTC recently broke past $82K, its highest level since late January 2026.
Market appetite for risk has not just been apparent in crypto spot prices either — major US equity indexes, including the S&P 500 and Nasdaq-100, both closed at multiple new all-time highs since mid-April after a number of signs from President Trump and his administration that the US is looking to de-escalate Middle East tensions.
The improving geopolitical backdrop, albeit still a highly-fluid situation, alongside crypto-specific factors including progress on the previously stalled CLARITY Act, has meant that Bitcoin is already up about 6% month-to-date.
That follows a 12% rally from $68K to $76K in the month of April 2026.
READ MORE (published Wed, May 6): Bitcoin hits $82k, a 3-month high! Is this a new bull market?
If history is any guide, what can we expect for the spot price for the rest of the month?
Since 2021, there have been 17 other months where BTC has rallied by about 12% or more in a single month.
Looking across all 17, the average return the following month was +4.3% — a modestly bullish outlook.
More importantly, however, in 9 of those 17 months, BTC kept climbing into the next month — and when it did, those 9 months averaged a further +13.9% gain.
For proper context, 9 out of 17 episodes equates to odds that are just slightly better (53%) than a coin toss.
Still, given the strong average performance when gains are indeed extended into a second month, how are derivative markets currently positioning themselves?
Open interest in perpetual futures contracts for BTC increased from $3.7B to over $4.5B since the beginning of the month of May, while total open interest across several blue-chip altcoins has risen close to the 30-day high reached on April 17, 2026.
That date coincided with comments from President Trump that Iran had agreed to almost all of the US’s conditions and that a “good deal” would be signed between the two parties.
Perpetual Futures Contracts Open Interest
BTC funding rates also briefly showed optimism as spot price broke past a key psychological $80K threshold, which failed to hold for long, and rates have turned negative on a 7-day rolling average basis.
DECODE: Negative funding rates suggest traders are willing to pay a leveraged fee to maintain short positions on BTC.
BTC and ETH Perpetual Futures Funding Rates
Bitcoin options markets also back the cautious sentiment exhibited in perpetual futures markets.
In terms of implied volatility, May has picked up where April left off — IV levels across the curve have continued to fall with 7-day at-the-money implied volatility briefly falling to 31%.
The 30% region marks the year-to-date low for implied volatility, meaning options prices are trading close to their lowest prices so far this year.
The volatility term structure curve is upward sloping with longer-dated options trading at a premium to shorter maturities, though the curve has repriced vertically downwards, suggesting markets expect a more stable volatility environment across all forward-looking horizons.
BTC at-the-money Implied Volatility
May 2026 so far has also seen a compression in the premium assigned by the market to puts, particularly at shorter tenors.
Traders are clearly showing less demand for downside protection but not yet willing to fully give up their premium for protection as BTC ranges around the $80K mark.
This is a story we’ve seen consistently with spot rallies over the past few weeks and contrasts the at least, brief, spell of bullish sentiment in perp markets.
Despite spot price trading at a high last seen in January this year, BTC options traders are still cautious in completely shifting towards a bullish stance.
BTC 25-Delta Put-Call Skew
READ MORE (published Tue, May 5): Bybit Options Weekly Review (April 29–May 5)
ETH options traders have shown slightly more conviction.
For the first time in nearly three weeks, 25-delta 7-day call options briefly traded with a premium over OTM puts, an indication of some trader's willingness to participate in further upside moves.
As the ETH spot price failed to materially break out past $2,400, however, the put-premium quickly returned.
ETH 25-Delta Put-Call Skew
DISCLAIMER:This article is provided for general information and reflects the author’s views only. It does not constitute investment advice, nor an offer or solicitation to buy or sell any financial instruments or digital assets. Your ability to access or use any products or services mentioned may be subject to the laws and regulatory requirements of your jurisdiction.