Markets
Will Current Bitcoin Options Expiration Cause Markets to Fall?
There are around 20,000 expiring Bitcoin options with a notional value of $1.35 billion. However, today’s expiry event is much smaller than in previous weeks, so the impact on the market will likely be minimal.
However, a major Bitcoin options expiration event will occur on June 28, with $6.7 billion worth of notional value derivatives expiring.
Bitcoin Options Expiration
Current BTC contracts have a put/call ratio of 0.49, meaning twice as many long (buy) contracts are expiring as there are short (sell) positions.
The maximum pain point is $68,500, slightly higher than current spot prices. This is the level at which most losses will occur.
Bulls are still dominating BTC derivatives with nearly $1 billion in open interest at the $100,000 strike price, according to for Deribit. The $75,000 and $80,000 strike prices also attracted a lot of OI, with $723 million and $807 million, respectively.
Crypto derivatives tool provider Greeks Live commented that despite the large macroeconomic data week in the United States, “the crypto market underperformed, conventional currencies as a whole fell, and altcoins fell further.”
“There are fewer hot spots in the market recently and the market is relatively calm.”
It added that short-term implied volatility for Bitcoin and Ethereum has fallen below 50% and 60%, respectively. However, Ethereum ETF news later this month could impact market sentiment and volatility.
In addition to the current batch of Bitcoin options, 200,000 Ethereum options have expired with a 0.36 put/call, a maximum pain point of $3,600, and a notional value of $710 million.
Crypto Market Outlook
There has been little change in total market capitalization over the past 24 hours, remaining at $2.57 trillion.
However, the markets registered a retraction, with a drop of 7.5% in the last ten days.
Bitcoin was hovering around $67,000 in early trading Friday after falling to around $69,500 earlier this week. Analysts pointed out that profit-taking by Bitcoin miners contributed to the declines.
Charting guru Peter Brandt highlighted support levels should markets fall further.
Ethereum took a bigger hit this week, falling 7.7% to a four-week low of $3,434 on June 13, before recovering slightly to $3,515 at the time of writing.