- Today marks the expiration of $5.6 billion worth of Ethereum and Bitcoin options.
- There are 499,803 Ethereum and 61,320 Bitcoin contracts that expire.
- For both options, the put-to-call ratio indicates a bullish attitude.
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Today’s expiration of Bitcoin (BTC) and Ethereum (ETH) options is estimated to be worth $5.65 billion.
It is expected that this big expiration will bring significant volatility, and investors and traders will be closely monitoring the possible effects on the cryptocurrency market.
What Effects Will the Launch of the Spot Ethereum ETFs Have on the Crypto Options Market?
Based on data from Deribit, 61,320 Bitcoin contracts valued at around $4.07 billion are expiring today. Compared to the number of 20,679 contracts from the previous week, this is a significant increase. At this moment, the put-to-call ratio is 0.61, with a $63,000 maximum pain point.
Similar to this, there are a lot of Ethereum options expiring; 499,803 contracts for a combined total of nearly $1.59 billion are scheduled to expire. Ethereum has a maximum pain point of $3,300 and a put-to-call ratio of 0.46.
The price point at which option holders experience the greatest financial hardship is known as the maximum pain point in the cryptocurrency options market. Conversely, the put-to-call ratio indicates that buy options—also known as calls—are more common than sell options, or puts. The put-to-call ratio for this week demonstrates that traders are more likely to buy options than sell them, indicating a positive outlook for the market.
Interest in the health of the market has increased since spot Ethereum exchange-traded funds (ETFs) were recently introduced to the US market. The present market movements can be attributed, in part, to the combined effects of the Mt Gox distribution, ETF outflows, and a decline in the Nasdaq, according to analysts at Deribit.
At first, August 2 calls were purchased ahead of the Bitcoin Conference in Nashville, as Bitcoin continued to hold steady. But once the market encountered a slew of selling pressures, things changed. Analysts at Deribit saw a decrease in exposure to BTC options while buying ETH puts, indicating a cautious attitude among traders.
Adam, an analyst at Greeks.live, a cryptocurrency options trading platform, also offered his thoughts on the state of the market right now.
Adam went on to discuss the effects of the recent market recovery as well as outside variables like Donald Trump’s possible policy effects. He emphasized the calendar spread technique and gave traders advice on how to maximize their holdings by selecting the appropriate implied volatility (IV) at the appropriate moment.
As of this writing, the price of Bitcoin has recovered to $66,404 after momentarily dropping to $64,000 on July 25. Ethereum, on the other hand, had a precipitous drop, going from $3,469 on July 24 to $3,098. Since then, it has somewhat rebounded, now trading around $3,183.
Options contract expirations have historically resulted in significant, if brief, price fluctuations. Usually, the market quickly stabilizes. Traders should, however, exercise caution and keep an eye on technical indications and market mood in order to efficiently navigate any potential volatility.
Disclaimer : This article was created for informational purposes only and should not be taken as investment advice. An asset’s past performance does not predict its future returns. Before making an investment, please conduct your own research, as digital assets like cryptocurrencies are highly risky and volatile financial instruments.
