A major event is taking place today in the crypto derivatives market. Bitcoin and Ethereum options with a total value of more than $2.6 billion are approaching expiration.
Despite the recent price increase, derivatives market data shows cautious sentiment. Many traders continue to prepare for a possible decline.
The Main Volume Falls on Bitcoin
The majority of today’s expiration is related to bitcoin. According to the Deribit platform, contracts worth about $2.23 billion are expiring, which corresponds to 31,709 options. At the time of publication, bitcoin is holding around $70,700, staying above the psychological mark of $70,000.
However, the market structure indicates investor caution. The put-to-call ratio is 1.70, meaning the number of options betting on a decline significantly exceeds the number of bullish bets. Such a disparity usually means market participants are more actively hedging their positions against a possible price drop.
The ‘Max Pain’ Level Is Below the Current Price
Analysts are also paying attention to the max pain level. This is the price at which most options expire unprofitable for traders.
Simply put, it is the point where option holders lose the most money and contract sellers gain the maximum benefit. For bitcoin, this level is now around $69,000, about $1,700 below the current price.
Sometimes before expiration, the market gravitates toward this level. That’s why traders are watching closely to see if BTC stays above $70,000 until settlement.
Ethereum Also Participates in Expiration
Ethereum options make up a smaller but still notable share of today’s event. The total notional volume of contracts is about $398 million.
The price of ETH is holding at around $2,070. Here, the situation looks more neutral. The put-to-call ratio is 0.90, indicating an almost equal balance between bullish and bearish bets. The max pain level for Ethereum is around $1,950, about $120 below the current price.
Traders Sell Call Options
Despite the market recovery, derivatives participants are showing caution. According to analytics platform Greeks.live, call options used for bullish bets have been actively sold on the market in recent days.
Selling such contracts means traders are willing to collect a premium, expecting the price not to rise significantly above current levels. In other words, part of the market believes the current rally may slow down.
Volatility Is Rising Again
Amid price fluctuations, expected volatility has also increased noticeably. Expected volatility for bitcoin is now around 55%, while for Ethereum it has risen to about 75%.
This increase means market participants expect stronger price swings in the near future. This often happens during periods of uncertainty, when investors are actively hedging positions.
Derivatives Increase Bitcoin’s Influence on the Market
Another trend of recent weeks is the growth of bitcoin’s share in the structure of open interest in the options market. This means BTC continues to play a key role in shaping overall sentiment in the derivatives market. Even relatively small changes in its price can trigger a chain reaction of liquidations and position adjustments.
What Could Happen After Expiration
Option expiration often leads to short-term volatility spikes. After settlement, traders close old positions and open new ones, which can amplify price movement.
If bitcoin and Ethereum remain well above max pain levels, some market participants may start actively adjusting positions. In this case, the market could see sharp moves right after today’s expiration is completed.
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