Today, billions in crypto options are set to expire, including significant amounts of Bitcoin and Ethereum contracts. This event may impact the market.
Bitcoin and Ethereum Crypto Options
Approximately 80,000 Bitcoin options contracts, with a notional value of $8.36 billion, are set to expire today. Additionally, 600,000 Ethereum contracts, worth $1.95 billion, are also expiring. These two giants alone bring the total crypto options expiry value to an estimated $10.3 billion. Altcoin expiration will further add on to the total amount.
Put/Call Ratio Analysis
This week, Bitcoin options contracts have a put/call ratio of 0.68, meaning more longs than shorts. According to Deribit, the highest open interest (OI) strike price is at $120,000, which is $2.4 billion. There is also around $1.65 billion in OI at the $110,000 strike price. Ethereum contracts, in addition to today's Bitcoin tranche, have a notional value of $1.95 billion and a put/call ratio of 0.43.
What Are Bitcoin Options?
Bitcoin options are derivative contracts that grant traders the right, but not the obligation, to buy (call options) or sell (put options) Bitcoin at a predetermined price before the contract expires. These options are used by traders to hedge risk or speculate on future price movements. When these contracts expire, they may lead to market fluctuations, as traders usually choose to adjust their positions rather than letting them expire.
The expiration of large volumes of options can lead to significant market shifts. Traders must stay informed about these events to make informed decisions.
