$3.5 Billion in Crypto Options Expiry Set to Stir Market Volatility Amid Geopolitical Tensions
The cryptocurrency market braces for heightened volatility today as over $3.5 billion worth of Bitcoin and Ethereum options are set to expire, coinciding with escalating global geopolitical uncertainties.
According to data from Deribit, 27,959 Bitcoin option contracts—representing approximately $2.9 billion in notional value—will expire. The “maximum pain” price, the strike level at which the largest number of these contracts would expire worthless, is currently pegged at $106,500, just above Bitcoin’s market price of around $104,342 at press time. A put-to-call ratio of 0.91 suggests a slight bullish leaning among traders, with more calls than puts outstanding.
In parallel, 246,849 Ethereum options, with a notional value of $617.6 million, are also set to expire. Unlike Bitcoin, Ethereum’s put-to-call ratio stands at 1.14, signaling a more defensive market posture with more traders purchasing puts to hedge against downside risk. The max pain level for Ethereum is $2,650, compared to its current market price of approximately $2,515.
According to the Max Pain theory, prices of underlying assets often drift toward the max pain level as expiry approaches, driven in part by market makers adjusting their positions to benefit from options expiring worthless. This tendency is often linked to institutional trading strategies that seek to reduce exposure or maximize profit through options premiums.
Analysts at Greeks.live note increased bearish sentiment in the Ethereum market, highlighting a surge in protective put buying. Despite this, strong upward flows in ETH were recorded heading into the expiry period, indicating that traders remain split on market direction.
“ETH upside flows are strong heading into expiry. Will traders keep chasing it after Friday, or is this where it cools off?” Deribit questioned in a market update.
Market dynamics are further influenced by broader macroeconomic and geopolitical catalysts, including recent U.S. inflation data, trade negotiations between the U.S. and China, and tensions in the Middle East, particularly between Israel and Iran.
As traders recalibrate their positions post-expiry, short-term volatility could intensify, presenting both risks and opportunities across the crypto landscape.
