Bitcoin volatility rises after Trump’s Bitcoin Reserve and options expiry

Bitcoin’s price has entered a volatile trading range between $78,000 and $82,000 as bullish momentum fades and traders react to shifting macroeconomic conditions.

After briefly reclaiming $90,000 last week, a “sell-the-news” reaction to developments like the US Strategic Bitcoin Reserve and the White House Crypto Summit drove a pullback, erasing earlier gains, according to the latest Bitfinex Alpha report shared with crypto.news. 

Adding to the volatility, $3 billion in Bitcoin (BTC)  and Ethereum (ETH) options contracts expired last Friday, triggering significant price swings. The options market saw realized volatility surge above 80%, with implied volatility jumping 35.7% ahead of the summit as traders hedged positions. 

On-chain data revealed widespread losses, with traders recording $818 million in realized losses per day, particularly on February 28 and March 4—some of the largest daily loss events this cycle, according to the report.

The Bitcoin Spent Output Profit Ratio, a key metric measuring whether Bitcoin holders are selling at a profit or loss, fell into negative territory for the first time since October 2024. 

A reading below 1.0 typically indicates distress selling. Short-term holders, in particular, saw significant losses, with their SOPR at 0.95—the second-largest negative reading of this cycle. If the bull market structure holds, these levels could attract buyers, but extended weakness could signal further downside.

Sentiment ratings 

Uncertainty in the broader economy is also contributing to market hesitancy. The U.S. job market remains strong, with 151,000 jobs added in February, but the unemployment rate ticked up to 4.1% amid government job cuts.

Wage growth remains robust, but inflationary pressures and trade disruptions pose risks to economic stability. The manufacturing sector faces challenges, with new tariffs raising production costs and slowing new orders.

Meanwhile, regulatory shifts could reshape the crypto landscape. President Donald Trump’s Strategic Bitcoin Reserve now holds 187,000 BTC worth $13 billion, signaling a shift in U.S. policy from selling seized Bitcoin to retaining it as a national asset.

Additionally, the administration is pushing for stablecoin legislation by August and an end to restrictive policies like Operation Choke Point 2.0.

In Japan, crypto-friendly tax reforms are being introduced, including a 20% capital gains tax on digital assets and tax deferrals on crypto-to-crypto swaps. These changes could encourage greater digital asset investment.