Will Crypto Markets March Higher When $1.4B Bitcoin Options Expire?
Crypto markets have largely held on to gains this week, buoyed by Ethereum and the SEC’s approval of spot exchange-traded funds.
However, around $1.4 billion in Bitcoin options contracts will expire on May 24.
The 21,000 contract expiry is small compared to the May 31 expiry, which will see $4.3 billion worth of options expire, according to Deribit.
Bitcoin Options Expiry
The put/call ratio for this week’s Bitcoin options is 0.88, indicating that long and short-contract sellers are relatively evenly matched, with slightly more calls expiring. The max pain point, where most option buyers lose their premium, is $67000
Long positions dominate open interest (OI) with around $830 million at the $70,000 strike price. Higher strike prices also have substantial OI, with around $843 million at $100,000, according to Deribit
The $60,000 strike price has the highest OI for put contracts, totaling $388 million. Open interest refers to the number or value of unsettled contracts, indicating that bulls expect much higher BTC prices
In addition to today’s Bitcoin options, there are around 354,000 Ethereum contracts expiring today. These have a notional value of $1.5 billion and a put/call ratio of 0.57, with more calls expiring than puts.
Derivatives traders have been speculating on ETH in the run-up to the SEC deadline. There is around $515 million in OI at the $4,000 strike price as bulls expect more momentum.
Crypto Market Impact
Almost $3 billion in BTC and ETH options will expire today, but the impact on spot markets is usually muted. Total capitalization has dropped 1.3% to $2.68 trillion, primarily due to a 2.3% dip in Bitcoin prices as the asset fell to $67,400 at the time of writing.
Ethereum faced volatility ahead of yesterday’s decision but now stands calmly at $3,730.
The altcoins were a mixed bag with gains for Chainlink (LINK), PEPE, Ethereum Classic (ETC), and Inter Finance Network (IFNET), but losses for Solana (SOL), Dogecoin (DOGE), and Toncoin (TON)
