Institutions Show Limited Confidence in Bitcoin Despite Price Rally

The recent 7% surge in bitcoin's price to $77,160.41 has not been enough to instill confidence, as the recovery has stalled near $72,000 ahead of key events such as the US inflation report and US-Iran talks. Institutions are adopting a cautious approach, buying call options to bet on potential gains while also purchasing downside protection. According to QCP Capital, there is demand for the $45 call expiring in May, indicating expectations of a price rise above the current $40. Similarly, bitcoin options on Deribit have seen significant interest in the $80,000 call. However, the persistent demand for puts, which offer protection against declines, suggests a lingering bias towards caution. The US consumer price index for March is expected to show a significant increase in annualized inflation, led by rising energy prices. This could lead to market volatility, particularly if the core figure exceeds the estimated 2.7% annualized rate. The outcome of the US-Iran talks will also be crucial, as a resolution to the conflict could lead to increased stability in financial markets and a potential boost to bitcoin's price. The ICE BofA US Bond Market Option Volatility Estimate Index, which reflects volatility in US Treasury futures, has shown a decrease in turbulence, indicating a positive signal for crypto bulls.