Bitcoin traders just stripped away crash protection – right as the Fed prepares its most unpredictable rate decision in years

Bitcoin traders have spent the past month reducing protection against a price decline while the Fed has made its next decision harder to predict.The Bitcoin options put-to-call open-interest ratio has fallen to approximately 0.52 from 0.76 in late June, meaning about 52 put contracts remain open for every 100 calls. Meanwhile, Fed Funds futures assigned around a 35% probability to a quarter-point rate increase after the implied probability briefly reached 40% on Monday.Chart showing the target rate probabilities for the Fed's July 29 meeting as of July 28, 2026 (Source: CME FedWatch)So the two markets are now sending opposing signals. Interest rate traders see an unusually wide range of policy outcomes, while Bitcoin traders are paying less for protection against an immediate decline.Bitcoin traded near $63,400 on Tuesday as the Fed’s two-day meeting began. HSBC described Wednesday’s outcome as the most uncertain Fed decision in two years and one of the least certain in more than four years, according to Reuters.The uncertainty reflects Chair Kevin Warsh’s retreat from the forward guidance that previously helped investors narrow the range of likely outcomes before officials voted.T...