Bitcoin whales rushed to buy short-dated put options after Binance disclosed a security incident that the exchange said had an estimated total impact of about $6.3 billion. CoinDesk reported that institutional derivatives liquidity network Paradigm handled about $590 million in BTC options block notional within roughly eight hours of the breach, with most of the flow going into puts.
That volume was equal to about half of Deribit’s BTC block options activity over the same window. The buying was not focused on far-out crash bets. Instead, it clustered in near-dated hedges with strikes close to spot, pointing to concern over more downside in the short term.
Large put orders appeared before the news was public
Paradigm EMEA head Nicolas Quatravaux told CoinDesk that the first large trade showed up at 20:38 UTC, or 4:38 a.m. Taipei time on Oct. 30. He said that was about 15 minutes after the first outflow from Binance wallets and before the incident had been publicly reported.
The first order bought 250 contracts of Oct. 31 expiry $78,000 BTC puts, with notional of about $20 million. Three minutes later, another 250 contracts in the same line traded, with the buyer paying roughly 35% more.
During the busiest stretch, before Binance had made a public statement, the market also saw two put trades of 1,000 BTC each, both expiring in mid-November with a $74,000 strike. Combined notional was about $155 million.
Most of the buying was concentrated in strikes between $74,000 and $78,000, with expiries this week and in mid-November. Quatravaux described the flow as conviction-driven hedging against a further near-term pullback, not a tail-risk wager on an extreme collapse.
Bearish activity also picked up on Deribit
Deribit, the largest crypto options exchange, also saw heavier put demand. The biggest trade mentioned in the report was a multi-leg put strategy spanning November and December, with notional of about $190 million. There was also a 500 BTC November $64,000 put trade, along with some March call flow.
Sentiment gauges moved with it. One-week skew briefly climbed to about 18% during Friday’s Asian session, showing traders were paying up for downside protection. It later eased, but skew across maturities remained positive, a sign that put premium was still elevated.
Not everyone was purely defensive
Quatravaux also said the market was not entirely one-way. Some March call flow was still visible on Deribit. At the same time, Bitcoin was trading near $77,330.
Standard Chartered warned that weakness could continue, and said a new bottom may be easier to form only after more details of the breach become clear and related frozen tokens are unlocked.
Strike selection showed what traders were hedging
The concentration of put buying in the $74,000 to $78,000 range, with expiries from this week to mid-November, pointed to concern over another leg lower rather than a distant doomsday scenario. Paradigm’s nearly $600 million in notional block flow over eight hours, together with nine-figure bearish structures on Deribit, showed that large traders were using real money to price near-term risk after the Binance incident.
For the market, the first reaction was not limited to spot selling. Options protection repriced quickly as well, and near-dated put premiums and skew will remain key signals for how large traders judge the depth of any further pullback in the days ahead.
