Bitcoin and Ethereum Options Expire, Bringing a Combined $2.7 Billion of Open Interest to a Close

Traders were watching closely this morning as Bitcoin and Ethereum options worth a combined $2.7 billion expired at 8 AM UTC. Now with the dust settled

A large sum of Bitcoin and Ethereum options, to the tune of $2.7 billion, expired at 8 AM UTC today. As this event unfolded, both crypto behemoths experienced a slight downturn in their market value.

Bitcoin options, valued at $2.09 billion, reached their expiry, while Ethereum options, totalling $624 million in notional value, also came to a close. The concept of "max pain price," denoting the price level at which option holders face the greatest financial loss, is a crucial element in anticipating price action following such events.

What Was the Immediate Price Reaction to Today’s Options Expiry?

For Bitcoin, the max pain price stood at $98,000, whereas for Ethereum, it was $3,700. Notably, a substantial portion of these expiring contracts were associated with Deribit, a leading cryptocurrency options exchange.

On Deribit, Bitcoin options amounting to $1.83 billion in notional value expired, accompanied by a put/call ratio of 0.85 and a max pain price of $85,000. For Ethereum, the exchange held $259 million in notional value, with a put/call ratio of 0.60 and a max pain price of $2,000.

🚨 Options Expiry Alert! 🚨At 08:00 UTC tomorrow, ~$2.09B in crypto options are set to expire.$BTC: $1.83B notional | Put/Call: 0.85 | Max Pain: $85K $ETH: $259M notional | Put/Call: 0.60 | Max Pain: $2KWill we see a volatility squeeze or a slow unwind? Stay ahead with… pic.twitter.com/lJLMwAvioP

How Did Deribit Influence the Options Expiry Outcome?

The lower put/call ratio observed for Ethereum suggested a stronger bullish sentiment compared to Bitcoin leading into the expiry. However, the overall market conditions have resulted in price decreases for both assets.

Looking at Bitcoin’s technical indicators, the Bollinger Bands had suggested potential volatility, with the upper and lower bands showing a tightening pattern. While the max pain price for Bitcoin was significantly higher than its current trading price, the expiry event has contributed to a downward pressure.

However, should the price of Bitcoin dip below the lower band of the Bollinger Bands, the support level at $85,000 may be tested, which aligns with Deribit’s max pain level.

Ethereum’s Fibonacci retracement levels indicated that if Ethereum could maintain its momentum above the $3,700 level (the max pain price), the next significant resistance would align with the 1.618 Fibonacci extension, found around $2021.20. However, the expiry has seen Ethereum trade below this level.

According to data from CoinMarketCap, Bitcoin is currently trading under $84,000, reflecting a 2.13% decrease over the past 24 hours. Meanwhile, Ether (ETH) trades around $1,950, showing a 2.05% decline during the same period.

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