Will markets continue to fall when $1.8 billion in Bitcoin options expire today?

About 19,300 Bitcoin options contracts will expire on Friday, January 10, with a theoretical value of about $1.8 billion.

This week’s expiration event is very similar to last week’s, which had no direct impact on the spot markets. Bitcoin has been in retreat for the past few days after its latest foray into six-figure territory.

Expiration of Bitcoin Options

This week’s stretch of Bitcoin options contracts has a put/call ratio of 0.65, meaning there are more long (call) contracts expiring than short (put) sellers.

Open interest, or the value or number of options contracts that have not yet expired, is highest at the $120,000 strike price, with $1.48 billion in OI, according to Deribit. There is also over $1 billion in OI at the $100,000 and $110,000 strike prices, and speculators remain relatively bullish.

“In terms of options data, short-term IVs (implied volatility) rebounded slightly but remained at low levels, with the market pricing in future volatility unchanged,” the derivatives provider commented crypto Greeks Live earlier this week.

Bitcoin OI by Expiry. Source: Deribit

“We are not seeing the same level of exuberance in leveraged positions that had marked the first two forays above the key psychological 6-figure mark,” Deribit reported in its weekly outlook. He added that futures trading is profitable for those betting on short positions against Bitcoin (puts). However, more traders are still buying calls.

In addition to current Bitcoin options, around 140,000 Ethereum contracts expire today. These have a notional value of $455 million and a put/call ratio of 0.47. That brings the notional expiration value of Friday’s combined crypto options to about $2.2 billion.

The crypto market correction deepens

The total crypto market capitalization is down another 4.4% on the day to $3.37 trillion at the time of writing. Markets may have been shaken by the premise of the US government selling billions of dollars in Bitcoin, but the asset remains within its limited channel.

Bitcoin fell to an intraday low of $91,250, but rallied to regain the $93,000 level during Friday morning trade in Asia. However, it has lost another 2% over the past 24 hours and is down 9% since breaking six figures on January 7.

The asset is nearing the lower limits of a sideways channel that started in mid-November and needs to hold that level to avoid a bigger breakout to the downside.

#BTC

Bitcoin has practically dropped to the bottom of its $91,000-$101,165 range

The low $91,000 range needs to hold as support (blue) to avoid further downside and really deepen this multi-week corrective period$BTC #Crypto #Bitcoin https://t.co/Bn24aJuxtd pic.twitter.com/doIFyA6qYU

— Rekt Capital (@rektcapital) January 9, 2025

Ethereum and altcoins were all in the red this Friday morning as the market correction deepened on US inflation fears and FUD over the potential selloff.

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