Sentiment in the bitcoin BTC$70,816.15 market has flipped bullish and traders are betting on a rally above $80,000, with traders positioning for a rally above $80,000.

That's the message from decentralized exchange offering on-chain trading in crypto futures and options.

"Current options pricing shows roughly a 35% probability that BTC will reach above $80K by the end of June," Nick Forster, founder of on-chain options platform, Derive.xyz, told CoinDesk in an email. "Combined with the recovery in skew, this activity suggests many traders expect bitcoin to recover toward the $80K level between June and September."

Options are derivative contracts that let you bet on BTC prices moving up or down, but with a inbuilt safety net that ensures you lose only a small upfront fee, not your whole account, if the bet fails. It's akin to buying a lottery ticket.

A call lets you bet on price rallies, while a put lets you bet on price dumps. The latter is, therefore, seen as a protective hedge.

Traders typically track options skew – that telltale pricing gap between calls and puts – to sniff out where the market's leaning. Calls pricier than puts indicates Bullish tilt, while put premium suggests otherwise.

BTC's skew recovers

Bitcoin's seven day and 30-day skews have clawed back to -6% from the -25% panic lows in early February, when BTC cratered toward $25,000.

The shift signals traders dialing back on protective puts – less crash hedging, more steady nerves.

"Despite earlier fears of a catastrophic crash of the crypto markets, derivatives markets suggest those concerns may have been overstated. BTC skew – a key measure of sentiment in options markets – has rebounded sharply from around -25% (normalized by at-the-money implied volatility) to roughly +10% today, signaling a significant shift away from aggressive downside hedging," Forster said.

Skews based on leading centralized options exchange Deribit paint a similar picture.

According to Forster, put shorting (writing) has surged across venues in recent days, a sign that traders are willing to take on downside risk in exchange for premium, which is consistent with expectations of stabilizing or rising prices.

At press time, bitcoin changed hands near $70,000, up nearly 5% for the month, according to CoinDesk data.