Around $8.7 billion in Bitcoin and Ethereum options expire on February 27, representing one of the biggest crypto derivatives settlements of the year. As such, traders are bracing for some short-term volatility in the wake of it.
Bitcoin makes up the lion’s share, roughly $7.7 to $7.9 billion spread across more than 114,000 contracts. Ethereum trails with about $960 to $975 million from nearly 480,000 contracts. Together, the expiries make up about 20% of all open interest in major crypto options, meaning the potential to move prices is real.
Traders are keeping an eye on the “max pain” price, which is the level where the most options expire worthless. For this expiry, Bitcoin’s max pain is estimated around $75,000, while Ethereum’s sits near $2,200.
Right now, both coins are trading below those levels, with Bitcoin around $66,500 and Ethereum near $2,000. That could create some upward pressure as market makers adjust their positions and hedges.
Crypto options expirations often shake things up because traders have to either settle up, close out, or roll their positions forward. Doing so can trigger sudden waves of buying or selling, especially when liquidity providers are rebalancing.
Historically, big crypto options expiries have produced increased trading volumes and short-term price swings, more so when assets trade far from max pain levels.
This expiry comes at a sensitive moment, since Bitcoin and Ethereum have been stuck in a rut after recent drops. Compared to the price 30 days ago, both cryptos suffered big losses, with Bitcoin dropping approximately 26%, while Ethereum experienced a 35% price decline.
The event also shows just how much crypto derivatives now steer market moves. Deribit leads the way in Bitcoin and Ethereum options, as it’s the biggest crypto options exchange by far (over 80% market share) and holds most of these contracts.
Deribit CEO Luuk Strijers has pointed out that when more than a quarter of open interest expires in the money, things tend to get volatile as people close out or roll over.
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