It's Friday, which means it's time for the expiration of bitcoin options. It is anticipated that $1 billion in Ethereum (ETH) options and $1.39 billion in Bitcoin (BTC) options will settle today. What will happen to the prices of ETH and BTC?
Today will see the expiration of Bitcoin options contracts worth about $1.39 billion. Compared to the 96,000 contracts that settled last week, the tranche is substantially smaller.
Bitcoin's Maximum Pain Point at Options Expiration Is $61,000
23,367 Bitcoin contracts valued at $1.39 billion are scheduled to expire today, May 3. Deribit data indicates that the put-to-call ratio for Bitcoin is 0.50. The asset will result in financial losses for the highest number of holders at $61,000, which is the maximum pain threshold.
Greeks.live also used its official X (formerly Twitter) account to highlight the present status of the cryptocurrency market.
"In the short term, one can choose lower IV and price and start buying options properly and profitably now," posted Greeks.live. "Bitcoin and the cryptocurrency market as a whole are still experiencing a deep pullback, with April becoming the deepest pullback month in almost a year. Dvol fell directly from 74% to 55% this week, volatility expectations in the markets are falling extremely fast."
Approximately 334,248 Ethereum contracts will expire today in addition to Bitcoin options. These expiring contracts have a maximum pain point of $3,000, a put-to-call ratio of 0.36, and a notional value of about $1 billion.
The worldwide cryptocurrency market has seen a 4% growth in the last day, increasing its total global capitalization to $2.32 trillion, despite the significant correction that has occurred in recent days.
Bitcoin just saw a significant decline, falling below $57,000. But it's back up and currently hovers around $59,324. Ethereum, on the other hand, has increased by 1.5% to trade at $3,003.
However, we must keep in mind that the effect of the option expiration on the price of the underlying asset is transient. The market will usually correct for significant price swings the following day and return to normal.
May 2024, Cryptoniteuae