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Cryptocurrency options expiration puts Bitcoin, ETH, SOL, XRP, and MATIC traders in a quandary
The weekly expiry of cryptocurrency options has prompted traders to suddenly adopt a wait-and-watch approach despite major events such as the Ethereum ETF spot listing next week. Traders were seen liquidating their positions a day before the expiry, with experts saying this is likely due to high volatility.
Bitcoin and Ethereum prices are moving slightly under selling pressure as traders prepare for the expiry of $2 billion in cryptocurrency options on the world’s largest derivatives exchange, Deribit.
Bitcoin and ETH Options Expire Over $1.8 Billion
The global cryptocurrency market capitalization has seen a gradual decline from $2.41 trillion to $2.34 trillion. However, Spot Ethereum ETFs launch, Bitcoin Conference and other events have kept investors bullish on further market recovery. The Fear and Greed Index has seen a sudden jump from 25 (extreme fear) to 60 (greed) in just a week, indicating high volatility in the current market.
Market participants have taken a step back due to the expiration of cryptocurrency options. In addition 20,670 BTC options with a notional value of $1.33 billion expire today on Deribit. The put-call ratio is extremely high at 1.19 and the maximum pain point is at $62,000. It explains why the price of BTC dropped from $65,000 to $63,000.
However, Bitcoin’s implied volatility has increased significantly this week and continues to rise amid investor optimism. Implied volatility is typically a market’s prediction of a likely price movement.
Source: The Block
143,391 ETH options with a notional value of $0.49 billion expired, with a put-call ratio of 0.37. The maximum suffering price for Ethereum is $3,150, below the current ETH Price of $3,444. That indicates more room for traders to sell, but the expected launch of the Ethereum spot ETF next week is averting a sell-off.
Read also: Binance Traders Open New Short Positions on Bitcoin: What’s Next?
SOL, XRP and MATIC Expiration
Meanwhile, linear options tied to Solana (SOL), XRP and Polygon (MATIC) worth millions are also expiring on Deribit. The expiration of these linear crypto options is settled in USDC.
5,156 Solana options worth $8.5 million will expire today. The put-call ratio is 0.82 and the maximum pain point is $145. SOL price is currently trading at $165, up 3% in the last 24 hours and over 20% in a week. Speculation on the Solana ETF has turned investments bullish.
3,473 XRP Options with a notional value of $1.93 million are set to expire today. The put/call ratio is 0.70 and the paint price cap is $0.47. XRP Price fell to $0.55 from $0.64 after a 40% rally in a week. The community awaits the decision in the Ripple vs SEC case.
MATIC Options of a notional value of $751.80 will expire, with a put-call ratio of 0.76. The maximum pain price is $0.51, which is below the current price of $0.516. Polygon has set the migration date of the MATIC token to POL on September 4th.
Read also: Grayscale Ethereum ETF Mini-Trust Announces Full Fee Waiver Up to This Limit
Cryptocurrency market saw $160 million liquidation
According to Coinglass data, the cryptocurrency market has seen $160 million liquidated in the last 24 hours. The largest single order liquidation occurred on cryptocurrency exchange
OKX as an entity sold $4 million worth of ETH to USD. BTC, ETH, XRP, SOL, WLD, PEPE, DOGE, WIF, ORDI were the most liquidated cryptocurrencies in the last 24 hours.
Specifically, $123 million in long positions and $37 million in short positions were liquidated in the last 24 hours. Although the news of the Ethereum ETF launch may be delayed, the ETF listing and the growth of the entire cryptocurrency market are imminent, and the influx of funds will push cryptocurrencies higher.
Read also: Polygon Labs CISO Confirms CrowdStrike Is Used and Systems Are Not Affected