With the asset hitting an all-time high of over $69,000 this week, will today's massive expiration event push Bitcoin prices higher or start a correction?
Approximately 29,000 Bitcoin option contracts will expire on March 8th, with a notional value of approximately $2 billion.
This week's expiration event is slightly less than last week, but a huge event worth over $6 billion will occur at the end of March.
Bitcoin options expiration date approaching
Today's put/call ratio for Bitcoin option expirations is 0.86, meaning that the sellers of long and short contracts are relatively even.
The biggest pain point, the price at which most losses occur at expiration, is $60,000. Deribit data also revealed that there was a lot of open interest at strike prices of $65,000 and $70,000, with a total notional amount of $1.9 billion.
Cryptocurrency derivatives tools provider Greek Live reported this week that market volatility reached its highest level in nearly a year. Implied volatility (IV) for all major time periods has been trending upward significantly, and added that “Very short-term IV has reached 100% at one point.”
Implied volatility is a metric used to predict the market's expectations about the future price movement of an option's underlying asset.
“The volume and positions of options are increasing, and the benefits of options have become very clear recently. For spot buyers there are protected options, for long and short buyers there is high leverage, These are all trading tools with very high profit and loss margins.”
In addition to Bitcoin contracts, approximately 270,000 Ethereum options with a put/call ratio of 0.55 are scheduled to expire.
These have a notional value of $1.05 billion and a maximum pain point of $2,950. According to Deribit data, there is a lot of open interest on the $3,000 strike price and his $4,000, and the latter is even larger at his $826 million.
Virtual currency market outlook
The market capitalization of cryptocurrencies rose 2.2% on the day, reaching $2.67 trillion. Bitcoin rose 1.8% daily and was approaching $67,000 at the time of writing.
Ethereum is on a roll today, up 3.6% and above $3,900 for the first time in over two years.
However, the biggest mover of the day was Binance Coin (BNB), which rose 10% to reach $468, while the other Shiba Inu (SHIB) rose 11%, moving it closer to a top 10 market capitalization position. .
