$2.7 billion worth of Bitcoin and Ether options are set to expire.
An estimated $2.7 billion in Bitcoin and Ether options is set to expire on May 24, providing valuable insights into crypto market sentiment.
According to a post by X on Gress.live, 21,000 Bitcoin (BTC) options are about to expire at a call/call rate of 0.88. This indicates a close balance between buyers and sellers, with a slight tilt towards call options.
Meanwhile, the maximum pain point, which represents the price at which most option buyers are exposed to a loss, is $67,000, which is worth $1.4 billion.
While the upcoming 21,000 contract expiration is known, it pales in comparison to the large event on May 31, as reported by Derbit.
Deribit data shows that long positions are mainly dominated by open interest (OI), with a large volume of $830 million tied to a strike price of $70,000.
Additionally, a higher strike price indicates a significant OIA, specifically $843 million at the $100,000 mark, indicating strong interest among traders. With $388 million in open interest, the $60,000 strike price stands out as the most prominent for the contracts.
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This critical OI indicates that many contracts are unsettled, indicating that bulls are confident of a much higher Bitcoin price, as open interest represents the unsettled value of contracts awaiting settlement.
The options expiration event is not limited to Bitcoin as 350,000 Ether (ETH) contracts are also set to expire, representing a notional value of $1.3 billion. A put/call ratio of 0.58 and a high pain point of $3,200 suggest slightly higher volume, with more call options expiring than options.
According to Greeks.Live, Ethereum recently led the crypto rally, fueled by ETF growth, with a 20 percent gain in one day. Short-term options implied volatility (IV) reached 150% at one point, which is significantly higher than Bitcoin's current IV for the same period.
However, the difference between Bitcoin and Ethereum is now apparent. While Ethereum's bullishness remains strong, given the overall market trading and market structure, maintaining a high IV level for each major term is challenging.
This suggests that calendar distributions may be a better choice. In contrast, Bitcoin appears more balanced between long and short positions, with stronger sell call forces.
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