Bitcoin Options Expire: Traders Look for Post-Thanksgiving Volatility in $9B Worth
Bitcoin Options Worth $9B Expire Friday, Traders May be Thankful for the Post-Thanksgiving Volatility
If you’re a crypto enthusiast, this Friday might just be an exciting one for you! Around $9.4 billion in Bitcoin options are set to expire, bringing a wave of potential volatility to the market. What’s interesting is that the max pain price for Bitcoin is currently at $78,000, a significant drop from the current spot price.
As we approach the end of the week, traders are eyeing the potential for increased activity in the market. The expiration of both Bitcoin and Ethereum options contracts on the trading exchange Deribit could shake things up a bit. These contracts, totaling $9.4 billion for Bitcoin and $1.3 billion for Ethereum, are set to expire at 08:00 UTC on Nov. 29.
For those unfamiliar with options, they give holders the right to buy or sell an asset at a specific price within a certain timeframe. Now, breaking down the $9.4 billion in notional value of Bitcoin options expiring on Friday, over $4.2 billion (45%) are “in-the-money” (ITM). This means that these options are currently profitable based on the current market conditions.
It’s worth noting that a large portion of these ITM options are calls, which are bets that the price of Bitcoin will go up. This could lead to increased market volatility as we near the expiration date, as investors rush to close their positions for potentially big profits.
On the flip side, out-of-the-money (OTM) options, which are not currently profitable, are mostly puts, indicating hedging activity against potential downside risks. The disparity between the max pain price and the current spot price of Bitcoin could lead to further market movements, potentially pushing the price closer to $100,000.
While there’s a lot of speculation around where Bitcoin’s price might go post-expiration, it’s clear that the market is gearing up for an eventful end to the week. Whether you’re a seasoned trader or just a casual observer, the expiration of these options is sure to bring some excitement and potentially some big moves in the crypto space.
