Incoming Volatility? $4 Billion Options Expiry Looms Over Crypto Market

A total of $3.4 billion worth of Bitcoin ($BTC) options are set to expire today, November 15, 2024, while an additional $580 million worth of Ethereum ($ETH) options contracts are to expire as well, injecting uncertainty into the cryptocurrency market.

With a combined notional value of nearly $4 billion, the expiry of these contracts, representing 39,000 BTC and 189,000 ETH, could trigger increased volatility in the coming days. According to analysts from Greeks.live, the put-to-call ratio for Bitcoin options contracts sits at 0.84, suggesting a bias towards put options, which give holders the right but not the obligation to sell BTC at a predetermined price.

The analysts noted that the “maximum pain point” for Bitcoin, the price at which most options contracts would expire worthless, is at $80,000. Ethereum options, they wrote, have a put-to-call ratio of 0.92, with a “maximum pain point” at $3,000.

Bitcoin is at the time of writing trading around the $89,000 mark after surging more than 17.6% over the past week. The cryptocurrency has over the past 24-hour period endured a slight correction and saw a $93,000 all-time high earlier this week.

Meanwhile Ethereum’s Ether is trading at $3,100 after moving up 6.6% over the past week, and is down more than 3.3% over the past 24-hour period. The cryptocurrency saw a weekly high above the $3,400, but far from its all-time high near $4,600.

The analyst at Greeks.live noted that Republican candidate Donald Trump winning the US election and Elon Musk leading the government’s newly created Department of Government Efficiency (DOGE) will add a lot of possibilities to the crypto market for the next 4 years.”

Per their post, the significant rise in cryptocurrency prices led to a significant rise in implied volatility, while the implied volatility for longer-term options has remained relatively stable.

Featured image via Pixabay.