By
Temitope Olatunji
April 26th, 2024
The event scheduled quarterly comes at a time when the crypto market is experiencing a notable rally. In particular, BTC is hovering around $70,000, showing robust momentum with a 24-hour trading volume of $30.8 billion
Bitcoin (BTC) and Ethereum (ETH), the world’s largest cryptocurrencies are about to make history with a $15 billion options expiry scheduled for today. Despite the recent crypto market uptick, BTC and ETH face liquidity uncertainty, leaving investors wondering how the price will move.
Details of Bitcoin and Ethereum Options Expiry
Data from the Professional Options Traders’ platform, GreeksLive indicated that a total of 135,000 Bitcoin options and 1.58 million Ethereum options will expire today.
According to Deribit data, the $15 billion expiry is among the largest in the exchange’s history as the expiry will wipe off 40% and 43% of the total notional open interest in Bitcoin and Ethereum, respectively, across maturities. This puts BTC and ETH at notional values of $9.5 billion and $5.6 billion respectively. Notional open interest refers to the dollar value of the number of active contracts at a given time.
29 Mar Options Data
135,000 BTC options expired with a Put Call Ratio of 0.85, a Maxpain point of $51,000 and a notional value of $9.5 billion.
1.58 million ETH options expired with a Put Call Ratio of 0.63, Maxpain point of $2,600 and notional value of $5.6 billion.
Today is… pic.twitter.com/GMReViYURA— Greeks.live (@GreeksLive) March 29, 2024
Furthermore, while the Bitcoin options have a Put Call Ratio of 0.85, indicating a small preference for put options, Ethereum shows a Put Call Ratio of 0.63, with a Maxpain point of $2,600.
To properly comprehend the Options market, it is important to know that a Call Option grants a trader the right to purchase an underlying asset at a preset price at a later date, while a Put Option, on the other hand, grants the right to sell an asset at a preset price, regardless of its dollar value.
Impact on Bitcoin and Ethereum Price
The event scheduled quarterly comes at a time when the crypto market is experiencing a notable rally. In particular, BTC is hovering around $70,000, showing robust momentum with a 24-hour trading volume of $30.8 billion. On the other hand, ETH is trading at around $3,500, with its trading volume standing at $13.8 billion.
However, Implied Volatility (IV) is still strong across all key terms. This suggests increased uncertainty and expectation among traders about probable price fluctuations after the expiration. With the strike price for Bitcoin and Ethereum’s Call Options set at a relatively low price, investors may choose to buy additional assets at a lower price, causing the price to increase.
For Bitcoin, a key event that could contribute to its price climbing higher is the halving event scheduled for April.
The Bitcoin halving occurs when Bitcoin’s mining reward is divided in half. The blockchain network takes around four years to open 210,000 more blocks, a criterion established by the blockchain’s creators to continuously limit the rate at which the coin is introduced.
Historically, Bitcoin halving events have been linked to large price changes. especially when complimented by the massive inflows into spot Bitcoin ETF products trading in the US. However, market participants including Coinbase crypto exchange noted in an earlier report by Coinspeaker that established trends may no longer hold for this round because of pattern variations.