Will Bitcoin's $3 Billion Options Expiry Shake the Crypto Market?
Massive Bitcoin and Ethereum Options Expiry Could Influence Market Sentiment
Around 35,000 Bitcoin options contracts, with a combined notional value nearing $2.9 billion, are set to expire today, March 14. While this week's expiration is slightly larger than the previous one, it's just a prelude to the colossal $11 billion expiry scheduled for the end of the quarter on March 28.
Bitcoin Options Expiry: Market Impact and Sentiment
Despite the significant value of expiring contracts, the immediate effect on spot markets may be muted, as traders have already digested lower-than-expected U.S. inflation data.
The current batch of Bitcoin options has a put/call ratio of 0.73, meaning there are more bullish call contracts than bearish put contracts set to expire. Data from Deribit reveals that open interest (OI) remains high at the $120,000 strike price, totaling $1.4 billion. Additionally, there is $1.6 billion in OI at the $100,000 level and $1.3 billion at $120,000. However, bearish traders are betting big as well, with nearly $850 million staked on Bitcoin dropping to $70,000.
Crypto derivatives provider Greeks Live noted that the market sentiment remains "predominantly bearish" in the short term, despite positive inflation data. Traders are closely monitoring support levels, with some identifying $60,000 as a possible downside target. Analysts have also questioned the persistence of bearish sentiment in the face of otherwise strong bullish fundamentals.
Alongside Bitcoin, around 220,000 Ethereum options contracts are also set to expire today, carrying a notional value of $416 million. The put/call ratio for Ethereum contracts stands at 0.68. Altogether, the combined crypto options expiry totals approximately $3.3 billion.
Crypto Market Outlook: Bitcoin and Altcoins in the Red
Crypto markets are experiencing a downturn this Friday, with total capitalization sliding 3.7% to $2.76 trillion. Bitcoin briefly fell to $80,000 before rebounding slightly to $82,000 in the early Asian trading session, though it remains under pressure. Analysts warn of a potential deeper correction, with some predicting a drop to $70,000.
Ethereum is struggling as well, failing to break past $1,900 after dipping to $1,830. The altcoin market is showing mixed signals - Cardano (ADA), Pi Network (PI), and Hedera (HBAR) have seen larger losses, while XRP, Binance Coin (BNB), Tron (TRX), and Stellar (XLM) have managed to eke out minor gains.
With today's massive expiry and heightened market volatility, all eyes remain on Bitcoin's next move. Will the bears take control, or is a rebound on the horizon?
