By
Svetlana Soroka
June 16th, 2024
While the expiration of the 375,000 BTC and ETH options, with a combined valuation of close to $3 million, may influence market dynamics, the overall impact is uncertain.
Today marks a crucial day in the crypto world as nearly $3 billion worth of Bitcoin (BTC) and Ethereum (ETH) options are set to expire. Despite recent gains, the expiration of these contracts adds an element of uncertainty to the market.
According to data from Greeks.Live, a blockchain derivatives market tool, approximately 21,000 BTC and 354,000 ETH contracts will be expiring today, May 24. These contracts represent a substantial sum, with $1.4 billion in BTC options and $1.3 billion in ETH options.
Bitcoin and Ethereum Options to Expire Today
While this week’s expiring contracts are huge, even larger options expirations are expected next week. According to separate data from Deribit, a whopping $4.3 billion worth of options contracts are set to expire next week on May 31.
For this week’s expiring contract options, the put-call ratios for BTC stand at 0.88 while that of ETH is 0.58.
The ratios provide insights into market sentiments regarding the contracts. The 0.88 put-call ratio for Bitcoin indicates a relatively balanced distribution between long and short positions.
The “max pain point”, representing the price at which the majority of option contract buyers incur losses, is $67,000 for Bitcoin and $3,200 for Ethereum, with a higher number of call options expiring compared to put options.
Crypto Market Impact
While the expiration of the 375,000 BTC and ETH options, with a combined valuation of close to $3 million, may influence market dynamics, the overall impact is uncertain.
The total market capitalization has seen a decline, dropping to $2.5 trillion. The figure represents a decrease of 3.70% at press time. The dip could be attributed to the 4.05% decline in BTC prices as the leading crypto asset fell to $66,984 at the time of writing.
As for Ethereum, the digital asset faced massive volatility before the recent approval of Ethereum-based exchange-traded funds (ETFs). Last week, Ether dipped below $2,700. However, the asset awakened following speculations that it would get an ETF just like BTC.
The speculation resulted in the digital asset reaching a peak of $3,900 just two days ago. Although it has since dropped and is currently trading at around $3,660.
Alternative cryptocurrencies (altcoins) have also experienced mixed movements, with some like Solana (SOL) dropping by 8% in the past 24 hours. SOL is currently valued at around $162.
As for Dogecoin (DOGE), Cardano (ADA), Shiba Inu (SHIB), Toncoin (TON), and Avalanche (AVAX), these altcoins experienced between a 7.3% to 6.0% decline in the last 24 hours.
Others like Chainlink (LINK), Pepe (PEPE), and Ethereum Classic (ETC) show positive momentum.