An estimated $2.7 billion worth of Bitcoin and Ether options are scheduled to expire on May 24, offering valuable insights into the sentiment of the cryptocurrency market.
According to a post on X by Greeks.live, there are about 21,000 Bitcoin (BTC) options expiring, with a put/call ratio of 0.88. This indicates a fairly even balance between buyers and sellers, with a slight preference for call options.
The maximum pain point, which is the price at which most option buyers would experience losses, is $67,000, representing a total value of $1.4 billion.
While the upcoming expiration of 21,000 contracts is significant, it pales in comparison to the much larger event on May 31. On that day, a staggering $4.3 billion worth of options are set to expire, according to Deribit.
Deribit data shows that long positions dominate in terms of open interest (OI), with a substantial $830 million tied to the $70,000 strike price. Higher strike prices also have significant OI, notably $843 million at the $100,000 mark, indicating a bullish sentiment among traders. The $60,000 strike price stands out as the most notable for put contracts, with $388 million in open interest.
This substantial OI suggests that many contracts have yet to be settled, indicating that bulls are confident in much higher Bitcoin prices. OI represents the unresolved value of contracts waiting to be settled.
The options expiration event is not limited to Bitcoin. There are also a significant 350,000 Ether (ETH) contracts expiring, representing a notional value of $1.3 billion. The put/call ratio of 0.58 and a max pain point of $3,200 suggest a slightly bullish tone, with more call options expiring than put options.
According to Greeks.live’s report, Ethereum recently took the lead in the crypto rally, fueled by progress in ETFs, with a one-day increase of 20%. The short-term options implied volatility (IV) reached 150% at one point, significantly higher than Bitcoin’s current IV for the same period.
However, the divergence between Bitcoin and Ethereum is now apparent. While Ethereum’s bullish sentiment remains strong, maintaining high IV levels for each major term is challenging in terms of overall market trading and structure.
This suggests that calendar spreads may be a better choice. In contrast, Bitcoin appears to have a more balanced distribution between long and short positions, with stronger selling pressures for call options.
Magazine: The actual risks to Ethena’s stablecoin model (are not the ones you think)