Today in the cryptocurrency market, there is a significant development affecting the price of Bitcoin. The expiration of Bitcoin options is approaching. Spot prices are hovering above the $60,000 level. However, today, a considerably large amount will expire. There are about 21,800 Bitcoin option contracts due to expire. These derivatives have a nominal value of approximately $1.33 billion. Numerically, this is marginally lower than last week’s expiration event.
Bitcoin Price Above $62,000 But Volatile
Crypto markets have experienced a sharp decline throughout the week, and Bitcoin faces the risk of losing the psychologically important $60,000 level.
Today, the put/call ratio of expiring BTC contracts is 0.63. This means that the expiring call (long) contracts are almost twice as many as put (short) contracts.
According to Deribit, bulls still dominate the derivatives markets with the highest open interest at the $80,000 strike price. There are contracts worth $881 million focused on long positions at this level, and over $700 million in OI at both the $70,000 and $75,000 strike prices. Only $453 million in OI is at the $60,000 level, which is closer to the maximum pain point and current spot prices.
Ethereum Options Also Nearing Expiration
Crypto derivatives provider Greeks Live commented that despite “widespread panic in the market” this week, as BTC lost the $60,000 level and ETH dropped below $3,000, the implied volatility of major expiring options significantly decreased. Implied volatility (IV) represents future market volatility measurements derived from expiring derivative contracts.
In addition to today’s Bitcoin options expiring, 297,000 Ethereum option contracts will also expire. Their nominal value is $960 million, and the put/call ratio is 0.42, indicating that long positions significantly outnumber short positions. Greeks Live stated, “Ethereum’s long side is more fragile and has limited ability to lead the market.”
These developments in the options markets could be seen as a critical turning point in the cryptocurrency market, representing a situation that investors should closely monitor. As of writing this article, the cryptocurrency BTC is priced at $63,216, while Ethereum is trading at $3,045.
