Bitcoin and altcoins started to rise after the US CPI came in below expectations. Today is critical for two leading cryptocurrencies. Because $2.1 billion worth of Bitcoin and Ethereum options are expiring. This cryptocurrency options contracts expiration is particularly interesting as it will be delayed after the cold US CPI. So how will the development affect the prices of cryptocurrencies and the broader market?
BTC and ETH options expiration: What are their maximum pain points?
Approximately $1.18 million in 18,183 Bitcoin options contracts will expire today. This tranche is very similar to the 18,359 contracts awarded last week. Deribit data shows Bitcoin’s put-to-call ratio is 0.62. This figure shows that buying options (calls) are more common than selling options (puts). Additionally, data reveals that Bitcoin’s maximum pain point is $63,000. The maximum pain point is the price at which the asset will cause financial losses for the largest number of owners.
In addition to Bitcoin options, 321,925 Ethereum contracts will also expire today. The face value of these expiring contracts is over $940 million, the put-to-call ratio is 0.27, and the pain point is $3,000.
Expiring options and their impact on cryptocurrency prices
Greeks.live, a tool provider for crypto options traders, shared its perspective on option contracts expiring today. Evaluated the impact of the release of US inflation data on the crypto options market. Regarding the subject, Greeks.live underlined the following points:
The options market has reacted significantly with all major futures (implied volatilities) IVs rapidly rising to monthly highs, and the recent sideways market has caused major futures option IVs to fall to new lows at some point this year, thus pushing them making it extremely cost-effective for buyers, the option is worth purchasing for any new event driver.
Although option expirations can cause sharp price movements, this effect is usually temporary. The market usually stabilizes the next day, compensating for initial fluctuations. However, investors should carefully analyze technical indicators and market sentiment before investing in this volatile environment.
Long-term options are leaning towards the bull side
The higher implied volatility of out-of-the-money (OTM) put options compared to call options indicates that derivatives traders are paying high premiums for OTM put options, according to CF Benchmarks analysts. This indicates a short-term market sentiment. Because traders are protected against a possible decline in the value of Bitcoin.
In contrast to the short-term view, analysts note a “flatter” volatility curve for longer-term puts and calls, with a slight slope toward puts. This shows that investors are more optimistic about Bitcoin’s long-term prospects. cryptokoin.comAs you follow from , disinflation expectations increased following the positive CPI report. So it will be interesting to see whether this skew towards calls increases.
To be informed about the latest developments, follow us twitter‘in, Facebookin and InstagramFollow on and Telegram And YouTube Join our channel!