The impending expiration of a large number of Bitcoin (BTC) and Ethereum (ETH) options is a crucial moment for the cryptocurrency options market. With 21,000 BTC options and 350,000 ETH options set to expire, this event signifies a significant shift in both market dynamics and trader sentiment.
The BTC options that are nearing expiry have a combined notional value of around $1.4 billion. The Put Call Ratio for these options stands at 0.88, indicating a slightly bullish sentiment among traders. The strike price at which the most options would expire worthlessly, known as the maximum pain point, is $67,000. This level is important as it could impact the market behavior leading up to the expiration.
On the other hand, the ETH options show a stronger bullish sentiment, with a lower Put Call Ratio of 0.58. The total notional value of these options is close to $1.3 billion, and the maximum point is set at $3,200. Interestingly, Ethereum has been outperforming Bitcoin recently, thanks to positive developments surrounding Ethereum-traded funds (ETFs). This led to a 20% increase in ETH prices in just one day, accompanied by a soaring implied volatility (IV) for short-term options, reaching 150%.
The divergence between Bitcoin and Ethereum is becoming more apparent in block trading and market trading structures. Despite Ethereum’s solid bullish sentiment, maintaining high IV levels across all significant terms is proving to be challenging. Market analysts suggest that calendar spreads offer better opportunities under the current conditions. As for Bitcoin, the sentiment is more balanced, with noticeable pressures from call selling, indicating a mixed outlook among traders.
