TL;DR
- Deribit is preparing for a massive expiration of Bitcoin and Ethereum options next Friday, valued at $6.68 billion and $3.5 billion respectively.
- This event represents over 40% of Deribit’s total open interest and could lead to high volatility in the crypto markets.
- Deribit has been intensively preparing for the expected impact on BTC and ETH prices.
The crypto market could be in for a shake-up soon. Deribit, one of the leading cryptocurrency derivatives platforms, is gearing up for a massive expiration of Bitcoin and Ethereum options next Friday. According to recent reports, BTC options worth $6.68 billion and Ethereum options worth $3.5 billion will reach their expiration date.
The significance of this event lies in the financial volume terms, representing over 40% of Deribit’s total open interest. It could trigger high volatility in the markets. More than 25% of these options are anticipated to expire “in the money” — meaning they will be profitable for holders at the time of expiration — which is expected to increase trading volume and position adjustments that could influence BTC and ETH prices.
Luuk Strijers, CEO of Deribit, spoke about the importance of the expiration, highlighting external influences such as ‘quadruple witching’ in U.S. stock markets that could amplify volatility. Strijers emphasized that preparation for this event has been intensive, as historically, expirations of this magnitude have impacted crypto market prices and dynamics.
Bullish Run for BTC and ETH?
Despite recent downward pressure affecting Bitcoin and Ethereum, partly due to miner sales and other factors, options skew data suggests an optimistic sentiment among traders. There is a clear preference for both short-term and long-term call options, indicating expectations for a potential price recovery for BTC around July 12 and for ETH around July 5.
The expiration provides a landscape for adjusting trading and investment strategies. It is expected that the upcoming trading sessions following the expiration of options on Deribit will be crucial for the immediate direction of Bitcoin and Ethereum markets, as well as for the overall crypto market.
