Crypto News Today- Bitcoin and Ether options totaling $8.2 billion set to expire

What the $8.2B expiry of Bitcoin and Ether options means for market dynamics

Crypto News– On May 31, 69,000 Bitcoin options worth $4.7 billion and 920,000 Ether options worth $3.5 billion expired. The expiration of cryptocurrency options contracts has historically been associated with increased price volatility in the crypto market.

According to data from Derbit, the put/call ratio for the expired Bitcoin options (BTC) was 0.61. This indicates that more calls (or long contracts) expired than puts (or short contracts). Conversely, the put/call ratio for Ether (ETH) options was 0.46.

The put/call ratio (PCR) serves as a technical indicator reflecting trader sentiment in the market. A PCR below 0.7 typically indicates strong bullish sentiment, while a PCR above 1 suggests strong bearish sentiment.

The maximum pain point for Bitcoin is at $66,000, while for Ethereum it stands at $3,300

For Bitcoin, the maximum pain point, where leverage traders are anticipated to face the most losses, is $66,000. Meanwhile, for Ethereum, the corresponding point is $3,300. Currently, Bitcoin is trading at $68,210, which is $2,000 above its pain point, while Ethereum is trading at $3,738, exceeding its pain point by more than $400.

Millions in open interest (OI) are held in long positions with strike prices ranging from $70,000 to $100,000. Open interest refers to the total number of outstanding derivative contracts that have not yet been settled.

Several traders have opted for long positions on Bitcoin with a target price of $100,000. With $886 million in open interest (OI) at this strike price, the volume of long positions appears significant. The total notional value of all outstanding BTC options contracts amounts to $19 billion.

The aftermath of ETH approval: A lingering effect

The recent approval of the spot ETH ETF by the Securities and Exchange Commission (SEC) in May marked a significant and bullish event for the crypto market. Leading up to the approval, ETH prices surged by 20% in anticipation. However, it’s worth noting that the SEC only approved the 19b-4 filing, thereby postponing the actual listing for trading.

Following the ETH ETF approval, the crypto market has exhibited a sideways bearish trend, with ETH struggling to surpass the $4,000 mark and BTC facing resistance below the $70,000 price level. Presently, the crypto market is witnessing a bearish momentum, undergoing a correction phase after the bullish surge observed over the past two weeks.

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