The imminent expiration of a large number of Bitcoin (BTC) and Ethereum (ETH) options marks a significant moment for the cryptocurrency options market. A total of 21,000 BTC options and 350,000 ETH options are set to expire, signaling a notable shift in market dynamics and trader sentiment.
The BTC options that are nearing expiry have a combined notional value of around $1.4 billion. The Put Call Ratio stands at 0.88, indicating a slightly bullish sentiment among traders. The maximum pain point, which is the strike price at which the most options would expire worthlessly, is set at $67,000. This level is crucial as it could impact market behavior leading up to the expiration.
On the other hand, the ETH options display a stronger bullish sentiment with a lower Put Call Ratio of 0.58. The total notional value of these options is close to $1.3 billion, and the maximum point is $3,200. Interestingly, Ethereum has recently outperformed Bitcoin, driven by positive developments surrounding Ethereum-traded funds (ETFs). This resulted in a 20% price increase for ETH in just one day, while the implied volatility (IV) for short-term options skyrocketed to 150%.
The divergence between Bitcoin and Ethereum is becoming increasingly evident in block trading and market trading structures. Despite Ethereum’s solid bullish sentiment, maintaining high IV levels across all significant terms is challenging. Market analysts suggest that calendar spreads offer better opportunities under the current conditions. As for Bitcoin, the sentiment is more balanced, with noticeable pressures from call selling, indicating a mixed outlook among traders.