Bitcoin and Ethereum Options Expiration Sparks Volatility in Crypto Markets
Bitcoin (BTC) and Ethereum (ETH) options contracts worth nearly $3 billion were set to expire on December 13th, leading traders to brace for major volatility and key price action. With market makers repositioning amid a holiday trading lull, attention is focused on the $98,000 BTC and $3,700 ETH levels.
At the time of writing, Bitcoin was trading at $100,073, while Ethereum was priced at $3,881.12, according to Coingecko data.
Bitcoin Options Worth $2.1 Billion Near Expiry
Bitcoin has $2.1 billion in options contracts expiring, with the put-call ratio standing at 0.83, indicating more bullish bets than bearish ones. The max pain point, where most options will expire worthless, is $98,000.
Market watchers are closely monitoring Bitcoin’s next moves, given its market cap of $1.98 trillion and circulating supply of 20 million coins. The 24-hour trading volume for BTC has surged to $94.48 billion, signaling heightened activity as the expiration date approaches.
Ethereum Options See $640 Million Expire
Ethereum has $640 million in options expiring, with a put-call ratio of 0.68, indicating stronger bullish sentiment than Bitcoin. The max pain point for ETH is $3,700, a critical level that traders are keeping a close eye on.
Despite a slight 0.63% price decline in the last 24 hours, Ethereum’s week-to-week performance remains flat, reflecting a cautious approach among traders. Ethereum’s trading volume over the past day stands at $44.47 billion, with a market cap of $467.65 billion and a circulating supply of 120 million ETH.
Market Makers Reposition Amid Declining Liquidity
According to Greeks.live, market makers are adjusting their positions during the expiration period, coinciding with reduced trading volumes during the holiday season. Rising Implied Volatility (IV) suggests that markets are preparing for sharper price movements, with lower liquidity during the holidays potentially amplifying market volatility.
Analysts also note a growing correlation between crypto prices and U.S. stock markets, indicating that equities’ price swings could influence cryptocurrency movements.
Economic Data Adds Complexity
The options expiration follows a week of economic developments in the U.S., with November’s inflation rate increasing to 2.7% and core CPI at 0.3%, highlighting ongoing inflationary challenges. While a Federal Reserve rate cut is anticipated, concerns persist about whether inflation will delay easing.
These economic factors, coupled with the expiration of billions in crypto options, could lead to heightened market activity in the coming days. Stay tuned for more updates on Bitcoin and Ethereum price movements in the volatile crypto market.