Friday is cryptocurrency options expiration day. Therefore, more than $2 billion worth of BTC and ETH contracts are preparing to be settled or renewed today. Crypto markets rallied this week on spot ETF approvals. However, it is unclear whether this will continue.
This price is critical for the leading cryptocurrency!
Approximately 36,000 Bitcoin options contracts will expire on January 12. This major expiration event is larger than last week’s event, when $1 billion worth of contracts expired with little impact on markets. The face value of today’s large tranche of cryptocurrency contracts is approximately $1.68 billion. Additionally, the put/call ratio for this group is 0.9. So bulls and bears are evenly matched by selling long and short contracts. Additionally, the maximum pain point for this set is $45,000, which is slightly lower than the current spot market price.
According to Deribit, there is still large open interest with $1.2 billion worth of calls at the $50,000 strike price. What does such a large concentration of call options at this price indicate? Experts say derivative traders predict that BTC prices will rise by the end of January. Greek’s Live notes that Bitcoin spot ETF approvals went as expected this week. However, repeated fake news and breaking news have made the cryptocurrency market “frequently and sharply volatile.”
All major futures implied volatility declined significantly due to less market volatility than expected. Before concluding, Greeks Live notes that the long-term outlook is solid with plenty of incremental capital flowing into the cryptocurrency market. In this context, “But in the short term, there is still significant uncertainty in the market. “It is possible that sharp fluctuations like this week may continue for a few days.” says.
Ethereum options expiration has arrived
It’s not just the big Bitcoin options expiring today. In addition. 262.00 million Ethereum contracts will also expire. The face value of these options is $680 million and the put/call ratio is 0.64. Their maximum pain point is $2,400. This is slightly lower than the current cryptocurrency spot price. According to Deribit, there are also a lot of open positions at the 2,500 and 3,000 ETH strike prices.
Cryptocurrency markets fell by 0.76% during the day to $1.761 trillion. However, according to experts, it is unlikely that expiring option derivatives will seriously affect the market. At the time of writing, Bitcoin changed hands at $45,707. Ethereum, which has performed better this week, was trading at $2,585 at the time of writing.
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