Bitcoin and altcoin markets entered a closely watched week as investors awaited the U.S. Federal Reserve’s July interest rate decision.

The Fed is widely expected to leave interest rates unchanged, while remarks from Fed Chairman Kevin Warsh are expected to be closely monitored by cryptocurrency market participants. Fed rate decisions and accompanying commentary are watched across risk assets because they can shape expectations for liquidity, borrowing costs, and investor appetite for speculative markets, including crypto.

Ahead of the Fed announcement, BTC options traders reduced hedging positions tied to downside risk, according to Glassnode analysts.

Glassnode said the Bitcoin put/call ratio, which stood at 0.76 at the end of June and is viewed as an indicator of protection against a potential decline, has fallen to approximately 0.52. In options markets, a lower put/call ratio generally indicates relatively less demand for puts, which are commonly used to hedge or profit from downside moves, compared with calls, which are linked to upside exposure.

Analysts said the sharp drop suggests investors have reduced purchases of insurance against a possible pullback and have shifted back toward positioning for upside gains.

According to Glassnode data, large investors are actively accumulating $70,000 worth of call options. The data indicates that the market is strengthening its expectation for a short-term upward move in the Bitcoin price.

At the same time, analysts warned that if the Fed delivers a message that differs from market expectations, Bitcoin volatility could rise quickly because defensive positioning has declined. With fewer downside hedges in place, traders may be more exposed to abrupt repricing around the policy statement and subsequent remarks.

This is not investment advice.