3 BILLION CRYPTO OPTIONS EXPIRY: MARKET SURGE AHEAD?

This Friday marks the expiration of a significant number of Bitcoin and Ethereum options contracts, with a hefty batch set to conclude today.

Given Bitcoin’s recent peak surpassing $69,000, the question arises: will the substantial expiration event slated for today drive Bitcoin’s value up or trigger a market adjustment?

Approximately 29,000 Bitcoin options contracts are due for expiration on March 8, holding a notional value close to $2 billion.

Although this week’s expiration volume is somewhat lower than the previous week’s, a massive $6 billion worth of contracts are slated for expiration by the end of March.

Impending Bitcoin Options Expiration

The ratio of puts to calls for the Bitcoin options expiring today stands at 0.86, indicating a fairly balanced distribution between those holding long and short positions.

The “max pain” point is identified at $60,000, where the most significant number of contracts are poised to incur losses upon expiration. According to Deribit, substantial open interest exists for strike prices at $65,000 and $70,000, amounting to a combined notional value of $1.9 billion.

Greeks Live, a provider of crypto derivatives analytics, noted that this week witnessed the highest level of market volatility in almost a year. The report highlighted that all major implied volatility terms have seen a marked increase, with “ultra-short-term IVs reaching as high as 100% at one point.”

Implied volatility represents the market’s expectation of future price fluctuations of the underlying asset of an option.

The report further elaborated, “The volume of options and the positioning have grown, underscoring the benefits of options trading. This includes protected positions for spot traders and high leverage opportunities for those taking long or short positions, offering tools with potentially high profit/loss ratios.”

Additionally, about 270,000 Ethereum options are set to expire, featuring a put/call ratio of 0.55.

These contracts boast a notional value of $1.05 billion and a max pain point at $2,950. Deribit data shows significant open interest for strike prices at $3,000 and $4,000, with the latter drawing higher interest at $826 million.

Crypto Market Prospects

The overall crypto market cap has risen by 2.2% today, reaching $2.67 trillion. At the time of writing, Bitcoin was nearing $67,000, marking a 1.8% increase for the day.

Ethereum has shown stronger performance, climbing 3.6% to breach the $3,900 mark, a level not seen in over two years.

The day’s standout performers are Binance Coin (BNB), with a 10% gain reaching $468, and Shiba Inu (SHIB), which surged by 11%, potentially positioning itself within the top ten cryptocurrencies by market cap.

Read more from the blog

News

3 May 2023

StoneBlock CEO: Nervous investors will be eliminated from the market

News

22 Apr 2024

ANIMOCA BRANDS HOLDS $558M IN CRYPTO ON BALANCE SHEET 

News

22 Apr 2024

CRYPTOJACKER ACCUSED OF $3.5M FRAUD AGAINST TWO CLOUD PROVIDERS