This is the biggest pain point for Bitcoin and Ethereum in the current cycle


  • $1.3 billion of Bitcoin options are set to expire on October 28 with most holders finding the paper they were written on worthless.
  • Ethereum options worth $1.1 billion are also set to expire, two days after the altcoin ushered in a new price rally. 
  • Ethereum’s historical volatility has hit a monthly high of 57.35% in light of the massive breakout in the altcoin.

According to data from crypto options and futures exchange Deribit, on October 28, a larger-than-average $2.4 billion worth of Bitcoin and Ethereum options are set to expire. Over the past week, Ethereum price witnessed a massive recovery, and Bitcoin price climbed above the $20,000 level. 

Many option traders are likely to have been caught out by the bullish pivot, with data from options exchanges revealing a higher ratio of traders purchased bearish put contracts, betting on BTC and ETH price going down, than bet it would rise. The majority of losers will see their put options expire worthless, whilst those who bought bullish call options are set to celebrate. 

Also read: Bitcoin price: BTC approaches key level at $20,750, analyst predicts decline in the asset

Large volume of Bitcoin and Ethereum options expire on October 28

Data from Deribit, a crypto options exchange reveals a particularly large volume of Bitcoin and Ethereum options are set to be cashed in – or not, today.. $1.3 billion worth of Bitcoin options and $1.1 billion in Ethereum options reach their expiration date on October 28, 2022. The total Bitcoin option market cap at any given time rarely rises above $10 billion so that puts this mega-expiry into perspective. Indeed, it was only back in June 2020 that the record for a Bitcoin options expiry stood at $1 billion. 

Today options expiry is also significant due to the volatility in Bitcoin and Ethereum prices in the week leading up to the expiration date. 

Open interest by strike price on Deribit

Open interest by strike price on Deribit

Bitcoin and Ethereum maximum pain point

The past week saw Bitcoin price breaking past the $20,000 barrier and Ethereum yielding 17.5% gains for holders. Indeed, with its rapid price movements, Ethereum’s historical volatility has hit 57.35%, a monthly high. 

This is great news for those who bought BTC and ETH call options but not so great for those who bought put options. The Put/Call Ratio for the day for BTC stands at 0.85 for October 28 and shows the majority were buyers of puts and thus are likely to be feeling the pain as their contracts expire worthless. For Ethereum the Put/Call ratio stands at a lower 0.68 suggesting even more traders betted wrongly that the market would fall and will be drinking their cups of woe.

Colin Wu, a Chinese journalist has evaluated the data from Deribit’s charts on Bitcoin and Ethereum options and identified the $1,400 level as Ethereum’s biggest pain point, meaning if ETH remains above that level it will cause the greatest pain for bearish put holders. For Bitcoin the biggest pain point is the $19,500 level. 

The Put/Call ratio is considered an indicator of trader sentiment and a value greater than 0.7 which signal traders are buying more puts than calls, is usually interpreted as bearish. Therefore, at 0.85 and 0.68 trader sentiment for Bitcoin and Ethereum actually remains overall bearish. 

However the indicator can also be used in a contrarian fashion with volatile changes higher or lower signaling reversals on the horizon. It is in this way that it might have signaled the recent swing higher in price for the two cryptos. Further declines are unlikely but they might eventually give another contrarian bullish signal too.


Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Recommended content


Recommended Content

Editors’ Picks

Is Altcoin Season here as Bitcoin reaches a new all-time high?

Is Altcoin Season here as Bitcoin reaches a new all-time high?

Bitcoin reaches a new all-time high of $98,384 on Thursday, with altcoins following the suit. Reports highlight that the recent surge in altcoins was fueled by the victory of crypto-friendly candidate Donal Trump in the US presidential election.

More Altcoin News
Shanghai court confirms legal recognition of crypto ownership

Shanghai court confirms legal recognition of crypto ownership

A Shanghai court has confirmed that owning digital assets, including Bitcoin, is legal under Chinese law. Judge Sun Jie of the Shanghai Songjiang People’s Court shared this opinion through the WeChat account of the Shanghai High People’s Court.

More Cryptocurrencies News
BTC hits an all-time high above $97,850, inches away from the $100K mark

BTC hits an all-time high above $97,850, inches away from the $100K mark

Bitcoin hit a new all-time high of $97,852 on Thursday, and the technical outlook suggests a possible continuation of the rally to $100,000. BTC futures have surged past the $100,000 price mark on Deribit, and Lookonchain data shows whales are accumulating.

More Bitcoin News
Shiba Inu holders withdraw 1.67 trillion SHIB tokens from exchange

Shiba Inu holders withdraw 1.67 trillion SHIB tokens from exchange

Shiba Inu trades slightly higher, around $0.000024, on Thursday after declining more than 5% the previous week. SHIB’s on-chain metrics project a bullish outlook as holders accumulate recent dips, and dormant wallets are on the move, all pointing to a recovery in the cards.

More Shiba Inu News
Bitcoin: New high of $100K or correction to $78K?

Bitcoin: New high of $100K or correction to $78K?

Bitcoin surged to a new all-time high of $93,265 in the first half of the week, followed by a slight decline in the latter half. Reports highlight that Bitcoin’s current level is still not overvalued and could target levels above $100,000 in the coming weeks.

Read full analysis
Best Forex Brokers with Low Spreads

Best Forex Brokers with Low Spreads

VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.

Read More

BTC

ETH

XRP