Bitcoin traders hedged $60k and loaded up above $78k leaving the low $70k exposed

Bitcoin's end-of-September options expiry holds 130,670 BTC of open interest, compared with 79,003 BTC for August, a headline gap large enough to look like traders are loading up before the Federal Reserve's Sept. 16 decision.

DWF Labs market insights lead Martin Lee said in a note that most of that gap has nothing to do with the Fed. September and December are the two quarterly expiries in Bitcoin options, and together they hold 59.3% of all open interest, since traders often roll positions into them.

The story sits in how the market has quietly repriced its own risk.

The September book is mostly a red herring

Lee found that the top five strikes account for 31% of September's open interest, the same concentration he sees in both December and March. If September were an aggressive, concentrated bet on the Fed, the book would probably look different from routine quarterly positioning elsewhere on the calendar.

The week of July's Fed meeting traded 14,983 contracts, a number the DWF market insights lead described as mid-range for the summer.

The jump came weeks later, when weekly volume tripled to 64,749 contracts around Aug. 19, the same week the US Treasury announced it would at least double its long-end liquidity-support buybacks, raising the maximum operation size from $2 billion to at least $4 billion starting Sept. 9.