Bitcoin Options Premiums Surge Ahead of Central Bank Decisions Despite Fading Downside Skew

Bitcoin options traders face elevated short-term implied volatility premiums ahead of rate announcements from the Federal Reserve, European Central Bank, and Bank of Japan. Seven-day at-the-money implied volatility climbed to 36.5% from 32% the prior week, running 9.2 volatility points above seven-day realized volatility of 26.9%. Meanwhile, short-term demand for downside protection eroded, with one-week options skew dropping below 1% from nearly 10% a week earlier. Spot Bitcoin rose 2.3% and U.S. spot ETFs attracted $176 million in inflows on Tuesday, while markets price a 92% chance the Fed holds rates steady.