Bitcoin and Ethereum Options Expiry: What Will Be the Impact at the End of June?
As the end of June 2024 approaches, the crypto asset market is preparing for a major event: the expiration of Bitcoin (BTC) and Ethereum (ETH) options contracts.
The total value of BTC options that will expire is more than $4.3 billion. Meanwhile, ETH options contracts that will expire are around $3.3 billion.
Based on information we quoted from Beincrypto media, such a large contract volume has the potential to trigger significant volatility in the spot and derivatives markets, especially if there are differences in positions between major market players.
Put-Call Ratio and Market Sentiment Ambiguity
The options that will expire show interesting put-call ratio data. The BTC put-call ratio is at 0.49, which means that there are far more buy contracts (calls) than sell contracts (puts). This situation indicates the dominance of optimistic sentiment among investors.
For Ethereum, the put-call ratio is recorded at 0.36, showing a similar trend: the majority of market players are betting that the price of ETH will rise.
A low ratio indicates that the number of long positions is greater than the number of hedge positions.
Max Pain Price Levels and Potential Market Pressure
There is a concept of “max pain” in options—the price at which an option contract loses the most value by expiration. BTC’s max pain for this period is at $57,000, while ETH’s is around $3,100.
If prices approach these levels, traders with open positions could potentially make adjustments such as selling or buying spot and derivatives to reduce losses, which could trigger a sudden price movement.
BTC and ETH Price Trends Ahead of Expiration
At the time of writing, BTC is trading just above $61,000 after briefly strengthening to around $62,000. However, BTC has yet to break through its previous high.
Meanwhile, Ethereum has remained relatively stable above $3,300. ETH’s price stability comes amid strong market expectations for the approval of a spot Ethereum ETF in the United States.
Macro Factors That Play a Role
In addition to option expiration, macroeconomic conditions are also a major concern for market players. The US Federal Reserve’s statement on interest rate policy and the release of inflation data affect sentiment towards risky assebits, including crypto.
If US economic data shows a slowdown, selling pressure could increase, making the “max pain” scenario even more relevant for both BTC and ETH.
Conclusion: Is the Market Ready for Volatility?
The expiration of billion-dollar options is no small event. Retail and institutional investors need to pay close attention to critical price levels and the possibility of wild movements in late June.
This moment is often used as a risk management strategy, but also a major speculative opportunity. Therefore, caution is key to dealing with potential volatility in the near future.
