Bitcoin, Ethereum Options Expiration: What to Expect

A massive $10.31 billion in Bitcoin and Ethereum options contracts is set to expire today, February 31, potentially triggering market volatility.

According to Binance, this expiration could impact short-term price action, particularly given the recent decline in both assets.

Bitcoin options are valued at $8.36 billion, while Ethereum options stand at $1.94 billion. Traders are bracing for potential price swings as the expiration approaches.

“This could bring significant market volatility as traders reposition ahead of expiry, expect sharp price movements and potential liquidations,” warned Crypto Dad, a popular user on X.

Deribit data reveals that Bitcoin options expiration involves 80,179 contracts, up from 30,645 contracts last week. Ethereum’s expiring options total 603,426 contracts, a significant increase from 173,830 contracts the previous week.

The expiring Bitcoin options have a maximum pain price of $98,000 and a put-to-call ratio of 0.68, indicating a generally bullish sentiment. Ethereum’s expiring options have a maximum pain price of $3,300 and a put-to-call ratio of 0.43, reflecting a similar market outlook.

Put-to-call ratios below 1 for both Bitcoin and Ethereum suggest optimism in the market, with more traders betting on price increases. However, analysts urge caution due to the potential for market volatility.

“Traders often monitor this level as it can influence price movements as expiration approaches,” noted one analyst on X.

Based on the Max Pain theory, BTC and ETH prices are likely to approach their respective strike prices, leading to expected volatility. The maximum pain point or strike price is a crucial metric guiding market behavior.

As markets adapt to the new price environment, stabilization is expected soon after the expiration. With today’s high-volume expiration, traders and investors can anticipate a similar outcome, potentially influencing crypto market trends into the weekend.