Volatility Ahead? Massive $18 Billion Cryptocurrency Options Expiry Looms Over Crypto Market

by

As a seasoned researcher with over two decades of experience in financial markets, I find myself intrigued by the impending expiry of these massive bitcoin and Ethereum options contracts. With a combined notional value of nearly $18 billion, it’s hard not to feel a sense of anticipation as we await the market’s reaction.

14.17 billion dollars’ worth of bitcoin option contracts are due to end today, December 27, 2024, and an extra 3.74 billion dollars’ worth of Ethereum’s ether options will expire as well. This could potentially bring volatility or uncertainty into the cryptocurrency market.

Approximately $18 billion worth of Bitcoin and Ethereum contracts, comprising 150,000 BTC and 1.12 million ETH, are due to expire soon. This could potentially lead to heightened market fluctuations in the upcoming days. As reported by analysts from Greeks.live, the ratio of put options to call options for Bitcoin options contracts is currently at 0.69. This indicates a lean towards put options, which provide their holders with the option (but not the obligation) to sell Bitcoin at a specified price in the future.

Analysts found that the highest price where many bitcoin options might expire worthless is estimated to be around $85,000. For Ether options, they mentioned a put-to-call ratio of 0.41 and suggested a potential high price at which most could expire worthlessly as $3,000.

Currently, Bitcoin is being traded near the $96,700 region, following a 4% increase over the last seven days. However, since December 17, it has experienced a significant drop of about 11%, falling from its all-time high close to $108,500 to its present position.

Currently, Ethereum’s ether is being traded at approximately $3,400 following a 4.1% increase over the last week. However, it has decreased by over 17% since December 17. This price drop, along with that of many other high-risk assets, occurred after the Federal Reserve announced a more aggressive approach towards interest rate reductions in the upcoming year.

Analysts at Greeks.live shared on social media platform X that there’s an overall positive outlook for the entire cryptocurrency market next year, as President-elect Donald Trump is due to take office in January and his pro-crypto stance could make him one of the most crypto-friendly presidents ever.

Read More

2024-12-27 15:20