The cryptocurrency market is on high alert as an enormous $3.7 billion in Bitcoin options are slated for expiration on November 8. This significant event, which overshadows the previous week’s expiry, comes on the heels of pivotal occurrences such as the U.S. elections and the Federal Open Market Committee (FOMC) meeting. Historically, such substantial options expirations have the potential to trigger significant market movements, including massive sell-offs.
$3.7 Billion Bitcoin Options Expiry
According to recent data from Deribit, approximately 48,794 Bitcoin options contracts, valued at around $3.7 billion, are set to expire imminently. These contracts display a put-to-call ratio of 0.72, indicating a relatively balanced distribution between bearish and bullish stances. The maximum pain point, or the price level at which the majority of options would become worthless, is currently pegged at around $69,000.
Significant open interest (OI) is concentrated around the $80,000 strike price, amounting to a staggering $1.7 billion. This suggests that a segment of traders harbors optimism regarding a potential price surge. Following the election results, trading volumes surged to an unprecedented daily high of $60 billion, stimulated by Donald Trump’s victory. Subsequently, Bitcoin achieved a new all-time high (ATH) of $76,940, mirroring the market’s buoyant sentiment.
Analysts Signal Possible Profit-Taking
The crypto derivatives platform Greeks Live has observed a discernible trend of profit-taking in the options market. This suggests that the rally, driven by election outcomes, may be approaching its conclusion. As the election market rapidly cools, despite robust gains in both Bitcoin and Ether, and a generally optimistic sentiment in the cryptocurrency market, the options market is evidently winding down profit-taking activities as the election fervor subsides.
Moreover, the platform has reported a decline in “doomsday” Bitcoin options, which provide investors the opportunity to exit contracts early. This shift indicates a move towards a more optimistic market outlook.
Ethereum Options Set to Expire Too
In tandem with Bitcoin’s significant expiry, an estimated 294,000 Ethereum options contracts, valued at approximately $850 million, are also due to expire. These Ethereum contracts exhibit a put-to-call ratio of 0.65, with a maximum pain level set at $2,500. Collectively, the options expiry across Bitcoin and Ethereum today amounts to nearly $4.5 billion.
Meanwhile, both Bitcoin and Ethereum have reached new peaks, with Bitcoin hitting $76,872 and Ethereum climbing to $2,950. Although some altcoins have cooled following recent rallies, Solana (SOL) and Cardano (ADA) continue to show upward momentum, recording 5% and 14% gains, respectively.
