Bitcoin Options Market Maintained Stability in the Face of Year-End Expirations, While Ethereum Options Are Poised for Brief Volatility

According to a report published by crypto exchange Bybit and analytics platform Block Scholes, open interest in Bitcoin (BTC) perpetual swaps remained stable

Crypto exchange Bybit and analytics platform Block Scholes have unveiled their latest report, shedding light on the dynamics of the Bitcoin and Ethereum options markets in the lead-up to the year-end expirations.

As reported by Block Scholes, open interest (OI) in Bitcoin perpetual swaps remained largely stable throughout the year-end options expirations. This stability stood out, considering that options approaching their expiration dates usually trigger price swings.

According to the report, traders appeared cautious yet confident in the stability of their options positions, opting not to rely heavily on perpetual contracts to hedge the delta of expiring options. As a result, Bitcoin OI remained relatively stable, despite exhibiting muted volatility and failing to recover to the higher levels seen in December.

As previously reported by crypto.news, OI in Bitcoin futures fell below the $60 billion threshold. At the time of writing, total BTC OI stood at around $56.6 billion, having plunged at the beginning of January 2025. However, it remained higher compared to early November, when OI dropped below $40 billion.

The report also highlighted that the implied volatility term structure for BTC options remained steep, with implied volatility projected to stay at 57% over a one-week period for options trading five points lower.

A large portion of the expired open interest was yet to be reinvested, resulting in a neutral call-put balance. This indicated that the BTC options market had limited leverage compared to early December 2024.

Meanwhile, options in Ethereum remained largely stable throughout the end of December 2024. However, ETH's spot price showed lower volatility compared to its short-term implied volatility.

Over the past week, the implied volatility term structure for ETH options briefly plunged before flattening out again. Unlike BTC's consistent downturn, ETH's pattern suggested that its options market might be preparing for potential short-term volatility in spot price movements.

Despite nearing expiration dates, ETH call options gained momentum at the beginning of 202