Tomorrow, a major expiration event will occur in the crypto derivatives market. Approximately $3.9 billion worth of options contracts will reach expiration on Deribit, the world’s leading crypto options exchange.
$3.9 Billion in Crypto Options to Expire on Deribit as Investors Turn Bullish on Ethereum
This event is expected to cause significant volatility in both the Bitcoin (BTC) and Ethereum (ETH) markets.
Of the total, $3.3 billion is made up of the notional value of Bitcoin options. The Put/Call ratio is at 1.16, indicating a slight downtrend as traders hold more put options than calls.
However, the maximum pain point is set at $106,000, which is the price at which the option will become worthless, suggesting a relatively neutral positioning.
Market data suggests that BTC options are clustered around this level, suggesting a balanced outlook from investors ahead of expiration.
Meanwhile, Ethereum options total $546 million and the Put/Call ratio is just 0.68, a clear sign of bullish sentiment among traders.
The maximum pain price for ETH is $2,600, but option activity is weighted towards call positions, indicating strong expectations for an upward price movement.
The concept of maximum pain, where the most options expire worthless, is often cited as a short-term price magnet during expiration events. As such, current levels of $106,000 for BTC and $2,600 for ETH could act as centers of attraction in the hours leading up to expiration.
While Bitcoin’s market positioning appears cautious, Ethereum’s bullish momentum could lead to increased volatility and potential upside moves, especially if the overall market sentiment remains positive.
Traders and analysts will be watching closely to see if these expectations come true or if surprise moves disrupt the charts in the final hours before contracts close.
*This is not investment advice.
Read the full article here
