Deribit: $2.355 billion of bitcoin (BTC) and ethereum (ETH) options set for expiry

According to Debirit, approximately 103,000 Bitcoin contracts with a notional value of $2.357 billion and over 1.1 million Ethereum contracts valued at $2.355 billion will expire on December 30. The total open interest for options set to expire is around $4.68 billion and is one of the largest in recent times.

State of bitcoin and ethereum

Bitcoin (BTC) has resistance at around $21,000 and has been unable to break out of the descending channel. BTC remains bearish and moving sideways, with bulls unable to force prices above critical liquidation lines between $17.5k and $19k in the short term.

Overall, crypto assets remain under pressure primarily because of regulatory developments and FED’s inflation prediction. With $2.357 billion of BTC options set to expire and the coin in a bearish formation, analysts project further selling pressure and volatility in the immediate term. 

On the other hand, the maximum pain price for Ethereum (ETH) is $1800. The Ethereum price is currently at $1,196, and the ratio of put options to call options is 0.52, with 185,793.60 call options and 96,205.80 put options. In this state, Ethereum sellers have the upper hand and could cause the ETH price to drop to $800.

Crypto options are created by an issuer and listed on a crypto derivatives exchange like Deribit. Each options contract has a specified expiration date, which is the last day for settling the contract. The strike price is the price at which the options contract can be settled, and the premium is the price at which the options contract is purchased. 

Traders may buy a cryptocurrency option when they believe the underlying cryptocurrency is undervalued and its price is likely to rise, allowing them to sell at a higher price and make a profit.