Markets
Will Markets Move as $2.2 Billion of Crypto Options Expire?
Around $2.25 billion worth of cryptocurrency options contracts with a notional value will expire on June 7. Among them are approximately 18,000 Bitcoin options contracts, and these have a notional value of $1.25 billion.
Today’s crypto options expiration event is much smaller than the last few weeks The contract expires at the end of the month, so the impact on spot markets is likely to be minimal.
Bitcoin Options Expiration
The current batch of Bitcoin contracts has a put/call ratio of 0.67, with about a third more long contracts expiring than short contracts. Additionally, the maximum critical point, or the price at which most losses will be incurred, is $70,000. This is currently slightly below spot prices, which stand at just over $71,000 at the time of writing.
According to For Deribit, there is almost $1 billion of open interest (OI) at the $75,000 strike price. OI refers to the number or value of open contracts that have not yet been settled. Bullish derivatives traders are also targeting strike prices of $80,000 and $100,000, with an OI of $890 million and $969 million, respectively.
With the Bank of Canada and the European Central Bank initiating interest rate cuts this week and the market performing better thanks to BTC and ETH ETFs, there is a “more optimistic market atmosphere as the macro and news diverge significantly,” the crypto derivatives tool provider commented. The Greeks live.
He added that Bitcoin’s core implied volatility is around 50% and Ethereum’s around 55%, “both of which have fallen to a reasonable level.” IV is a measure of expected future volatility derived from expiring contracts.
Ethereum Options Expiration
In addition to the BTC contracts expiring today, 260,000 Ethereum options are expiring with a notional value of $1 billion. These have a put/call ratio of 0.64 and a maximum pain point of $3,650, slightly lower than the current spot price of $3,820.
Greeks Live observed that Bitcoin market volatility this month will be highly correlated with macro news on Fed interest. pricing decision while Ethereum is motivated by the news of ETF Approvals.
The crypto market cap was flat on the day at $2.78 trillion at the time of writing, but it has gained 4% over the past seven days. There has been very little movement for the majority of digital assets over the past 24 hours.