Bitcoin enters 2026 with a clearer market structure after year-end adjustments. Profit-taking pressure has eased, risk appetite has mildly recovered, but key to sustaining an upward trend remains the need to stabilize above important cost baselines. This article is based on a piece by Glassnode, organized, translated, and written by ForesightNews.
(Background: Co-founder of Glassnode: Bitcoin “hedge sell-off” pressure relieved, market will return to supply-demand price discovery mechanism)
(Additional context: Female market prophet predicts the US: Trump will buy 1 million BTC as Bitcoin national reserve)

Table of Contents

• Summary
• On-Chain Insights
  • Profit-taking pressure significantly eased
  • Facing overhead trapped supply resistance
  • Key recovery levels
  • Crossroads of profit and loss
• Off-Chain Insights
  • Digital asset treasury demand cools
  • ETF capital flows return to net inflow
  • Futures market participation rebounds
  • Options market positions “reshuffle”
  • Implied volatility may have bottomed
  • Market is balancing
  • New Year options trading favors bullishness
  • Market makers turn negative in key ranges
  • $95,000 call options premium shows patience
• Summary

Summary

· After deep correction and months of consolidation, Bitcoin officially enters 2026. On-chain data shows profit-taking pressure has markedly decreased, and the market structure shows initial stabilization at the lower end of the range.

· Although selling pressure has eased, a large amount of trapped supply remains above current prices, mainly concentrated in the upper half of the current range. This will continue to suppress upward movement, highlighting the importance of breaking through key resistance levels to restore an upward trend.

· Demand from digital asset treasuries still provides underlying support for Bitcoin prices, but this demand is sporadic and event-driven, lacking continuity and structural stability.

· After net outflows at the end of 2025, US spot Bitcoin ETF capital flows have recently shown signs of returning to net inflow. Meanwhile, open interest in futures markets has stopped declining and begun to rebound, indicating institutional investors are re-engaging, and derivatives activity is rebuilding.

· Record-sized options positions expired at year-end, with over 45% of open contracts liquidated, removing structural hedging constraints and allowing true risk appetite to be more clearly reflected in prices.

· Implied volatility has likely bottomed out, with modest upward pressure from buyers at the start of the year, but remains in a low range over the past three months.

· As the put options premium narrows and call options trading share increases, market skew continues to normalize. Since the new year, options trading has tilted clearly bullish, indicating investors are shifting from defensive hedging to active bullish positioning.

· In the $95,000 to $104,000 range, market makers have turned net short, meaning their hedging behavior when prices rise into this zone will passively support the rally. Additionally, the premium on call options around $95,000 indicates long holders tend to hold rather than rush to realize profits.

Overall, the market is gradually shifting from a defensive deleveraging phase to selectively increasing risk exposure, entering 2026 with a clearer structure and higher resilience.

On-Chain Insights

Profit-taking pressure significantly eased

In the first week of 2026, Bitcoin broke through a consolidation zone near $87,000 that had lasted for weeks, rising about 8.5%, with a high of $94,400. This rally was built on a significant reduction in overall profit-taking pressure. In late December 2025, the 7-day average realized profit had fallen sharply from the high levels of over $1 billion daily during most of Q4, down to $183.8 million.

The decline in realized profits, especially the reduced selling pressure from long-term holders, indicates that the main selling force suppressing price rises has been temporarily released. As seller strength weakens, the market stabilizes and regains confidence, fueling a new upward move. Therefore, the early-year breakout signals that profit-taking pressure has been effectively digested, opening space for prices to rise.

Facing overhead trapped supply resistance

As profit-taking pressure eases, prices can move higher, but the current rebound is entering a supply zone composed of different cost bases. The market has entered a range mainly controlled by “recent top buyers,” whose cost bases are densely distributed between $92,100 and $117,400. These investors bought heavily near previous highs and held through the decline from the all-time high to around $80,000, until the current rebound.

Thus, as prices climb back into their cost zones, these investors will have opportunities to break even or realize small profits, forming natural resistance to further upward movement. To truly restart a bull market, the market needs time and resilience to absorb this overhead supply and push prices decisively through this zone.

Key recovery levels

While facing overhead trapped supply, assessing whether the recent rebound can truly reverse the prior downtrend and enter a demand-driven phase requires a reliable price analysis framework. The short-term holder cost basis model is particularly important during this transition.

Notably, the weak market balance in December last year formed near the lower boundary of this model, reflecting fragile market sentiment and lack of buyer confidence. The subsequent rebound pushed prices back toward the model’s mean, around $99,100, which is the short-term holder cost basis.

Therefore, the first key confirmation signal of market recovery will be sustained price stability above this short-term holder cost basis, indicating renewed confidence among new entrants and a potential shift toward an active trend.

Crossroads of profit and loss

As the market focuses on whether it can effectively recover the short-term holder cost basis, the current structure resembles the failed rebound of Q1 2022. If prices cannot sustain above this level, deeper declines may occur. Continued lack of confidence could further reduce demand.

This dynamic is also clearly reflected in the short-term holder MVRV indicator, which compares spot price to the average cost of recent buyers, indicating their unrealized profit or loss.

Historically, when this indicator stays below 1(, meaning price is below average cost), the market tends to be dominated by bears. Currently, the indicator has rebounded from a low of 0.79 to 0.95, implying recent buyers are still holding about 5% unrealized loss. If it cannot quickly return to profitability(MVRV > 1), the market will face downside risk, making this a key watch point in the coming weeks.

Off-Chain Insights

Digital asset treasury demand cools

Corporate treasury holdings still provide important marginal demand support for Bitcoin, but their buying behavior remains intermittent and event-driven. There are multiple instances of net weekly inflows of thousands of BTC, but these purchases do not form a sustained, stable accumulation pattern.

Large capital inflows tend to occur during local price corrections or consolidations, indicating that corporate buying remains opportunistic and price-driven, rather than a long-term structural accumulation. Although institutional participation has expanded, overall capital inflows are sporadic, with long silent periods.

Without continuous treasury buying support, corporate demand more often acts as a “stabilizer” for prices rather than a driver of sustained upward trends. Market direction will increasingly depend on derivatives positions and short-term liquidity conditions.

ETF capital flows return to net inflow

Recent data shows early signs of institutional capital re-entering the US spot Bitcoin ETF market. After a period of net outflows and subdued trading at the end of 2025, recent weeks have seen clear net inflows, coinciding with prices stabilizing and rebounding in the $80,000 range.

While current net inflow levels have not yet reached the peaks of mid-cycle, the trend has shifted positively. Increasing days of net inflow indicate ETF investors are transitioning from net sellers to marginal buyers.

This shift suggests that institutional spot demand is once again becoming a positive market force, rather than a liquidity drain, providing structural buying support for the stabilized market at the start of the year.

Futures market participation rebounds

After the sharp deleveraging caused by price declines at the end of 2025, open interest in futures markets has recently begun to rise again. After falling from a cycle high of over $50 billion, open interest has stabilized and grown modestly, indicating derivatives traders are rebuilding risk positions.

This position rebuilding aligns with prices stabilizing above $80,000 to $90,000, showing traders are gradually increasing risk exposure rather than rushing to chase highs. The pace of new positions is moderate, and open interest remains well below previous cycle peaks, reducing the risk of large-scale liquidations in the short term.

The gentle rebound in open interest signals improved risk appetite locally, with derivatives buying gradually returning, helping prices initiate a new phase of valuation as liquidity normalizes early in the year.

Options market positions “reshuffle”

At the end of 2025, Bitcoin options experienced the largest position reset in history. Open contracts dropped from 579,258 on December 25 to 316,472 after expiry on December 26, a decrease of over 45%.

A large concentration of open positions at certain strike prices influences short-term price movements through market maker hedging. By year-end, this concentration was high, causing “price stickiness” and limiting volatility.

Now, this pattern has been broken. With expiry-driven liquidation, the market has shed its previous structural hedging constraints.

Post-expiry, the environment offers a clearer window into true sentiment, as new open positions reflect current risk appetite rather than residual positions, making early January options trading more directly indicative of market expectations.

Implied volatility may have bottomed

Following the large reset of options positions, implied volatility hit a short-term low during Christmas. During the holiday period, with light trading, weekly implied volatility fell to its lowest since late September last year.

Subsequently, buyer interest has begun to return, with investors gradually building bullish volatility positions( especially in the call options), gently lifting the volatility curve across maturities.

Although it has rebounded somewhat, implied volatility remains compressed. Volatilities across one week to six months are concentrated between 42.6% and 45.4%, with a relatively flat curve.

Volatility remains at low levels over the past three months, with recent increases more reflecting renewed market participation rather than a comprehensive re-pricing of risk.

Market is balancing

As implied volatility stabilizes, skew provides a clearer view of traders’ directional preferences. Over the past month, the premium of put options relative to calls has continued to narrow, with the 25-delta skew gradually returning toward zero.

This indicates a market gradually shifting toward bullish positioning. Demand is moving from purely hedging against downside to increasing exposure to upside opportunities, consistent with rebalancing after year-end position adjustments.

Meanwhile, defensive positions have decreased. Some downside protection has been unwound, reducing premiums paid for “black swan” insurance.

Overall, skew suggests market risk expression is becoming more balanced, with expectations for price increases or volatility expansion warming.

New Year options trading favors bullishness

Capital flow data confirms the trend reflected in skew. Since the start of the year, options activity has shifted from systematic selling of call options( betting on volatility decline) to active buying of calls( betting on upside or increased volatility).

In the past seven days, buy calls accounted for 30.8% of total options volume. The rising demand for calls has also attracted volatility sellers, who sell calls( making up 25.7% of total activity) to earn higher premiums.

Put options account for 43.5% of total volume, which is moderate given recent price increases. This aligns with the skew returning to neutrality, indicating reduced immediate downside protection demand.

Market makers turn negative in key ranges

With active call options trading since the new year, market maker positions have also adjusted accordingly. Currently, in the $95,000 to $104,000 range, market makers hold a net short position.

Within this zone, as prices rise, market makers hedge risk by buying spot or perpetual contracts, which passively supports the rally during market strength, contrasting with the environment at the end of last year that suppressed volatility.

In Q1, traders concentrated on buying calls in the $95,000 to $100,000 range, further indicating a shift in risk expression. The current market maker structure means their hedging in this zone no longer suppresses price movement and may even amplify the upward trend.

$95,000 call options premium shows patience

The premium behavior of call options at the $95,000 strike provides an effective indicator of market sentiment shifts. When spot was around $87,000 on January 1, the call premium at this strike began accelerating, rising along with the recent high of $94,400.

Since then, the premium has stabilized but not declined significantly. Importantly, this process has not been accompanied by a large increase in call option selling.

This indicates limited profit-taking. Since the recent high, call selling has only increased modestly, suggesting most bullish holders prefer to hold rather than lock in profits.

Overall, the behavior of call options premiums around $95,000 reflects bullish participants’ patience and confidence.

Summary

Bitcoin, entering the new year, has significantly cleared out historical positions in spot, futures, and options markets. The deleveraging at the end of 2025 and the expiry of year-end options have effectively removed previous structural constraints, leaving a cleaner, more signal-rich environment.

Early signs of renewed participation are emerging: ETF capital flows stabilize and rebound, futures activity rebuilds, and options markets clearly shift toward bullish positioning—skew normalizes, volatility bottoms, and market makers turn negative in key upper ranges.

These dynamics collectively indicate that the market is gradually transitioning from a defensive sell-off mode to a phase of selective risk increase and participation rebuilding. Although structural buying remains to be strengthened, the release of historical position pressures and renewed bullish sentiment suggest Bitcoin is opening a lighter, more flexible path into 2026, with improved internal structure and more potential for subsequent rallies.