Crypto options expiration is here again, with a large slate of Bitcoin and Ethereum contracts set to expire today.
About 23,000 Bitcoin options are set to expire on May 3. The notional value of these options is about $1.4 billion, which is comparable to previous expiration events.
Crypto markets have been falling sharply throughout the week but recovered slightly in late trading on May 2. However, Bitcoin’s price remains below $60,000 and short-term sentiment has turned bearish.
Bitcoin options expiration
The put/call ratio for large volume Bitcoin contracts today is 0.49. This means that there are twice as many call contracts (long contracts) expiring as put contracts (short contracts).
The maximum pain point price for these options, which refers to the price at which a contract would incur the greatest loss when it expires, is $61,000, slightly above the current spot price.
According to Deribit data, there is still a lot of open interest in options with a strike price above $70,000. Even if there is a small chance that BTC will reach a strike price of $100,000 in the short term, there is still $661 million in open interest at a strike price of $100,000 under current market conditions.
Greeks Live, a crypto derivatives solutions provider, commented on the launch of spot crypto ETFs (Exchange Traded Funds) in Hong Kong this week. The company noted that although the Hong Kong market has responded positively to the launch of these new financial products, the listings "did not bring much incremental trading volume". In addition, the company also mentioned that even in the United States, spot Bitcoin ETFs continued to face outflows this week.
Greeks Live further analyzed the market situation, adding that the current market weakness has led to a weakening of investor confidence. The background of this decline in confidence is that implied volatility across all major maturities continues to decline. Implied volatility is a measure of the market's expectations of future volatility, which is derived from the upcoming expiration of crypto derivatives contracts.
The company also pointed out that the current level of implied volatility is comparable to the average level during the last winter bull market, which suggests that the market has found some support at the current level. Based on such analysis, Greeks Live believes that it is a good choice to buy now considering the current state of implied volatility and the support provided by the market.
In short, Greeks Live’s view is that despite the near-term signs of weakness and declining confidence, the market has reached an attractive entry point from an implied volatility perspective, at least in terms of expectations for future volatility as implied volatility suggests.
Implied volatility is a measure of future expected volatility derived from expiring crypto derivatives contracts.
In addition to today’s Bitcoin options, approximately 330,000 Ethereum options are also set to expire. These options have a notional value of approximately $1 billion, bringing the total value of today’s crypto contract expiration events to $2.4 billion.
The put/call ratio for ETH options is 0.36, with the maximum pain point at $3,000, a level that was only recently recovered.
Crypto Market Recovery
The cryptocurrency market rebounded somewhat on Friday, with the overall market capitalization increasing. Bitcoin (BTC) prices rose after a period of volatility, but have yet to reach the $60,000 mark that is widely watched by the market.
Ethereum (ETH) had a strong start to the day, with prices briefly surpassing the psychologically important $3,000 mark, but have since fallen back below that level.
In addition, some other well-known alternative currencies, such as Solana, Dogecoin, Toncoin, Shiba Inu and Polkadot, also showed signs of recovery and had a solid market performance. #加密货币期权 #期权到期
