Today, approximately 2300 billion dollars worth of Bitcoin and Ethereum options are reaching their expiration. Traders are wary of a volatility reset, and the market is facing a significant inflection point.
With positions concentrated around key strike prices, price movements before and after expiration are likely to be influenced more by mechanical hedge flows than by fundamentals.
2300 billion dollars worth of options expiring, the price movements of Bitcoin and Ethereum are at a critical juncture
Bitcoin accounts for the majority of nominal value, with approximately $194 billion worth of BTC options reaching expiration.
Before expiration, Bitcoin is trading at $89,746, below the 'maximum pain' level of $92,000.
Open interest is 21,657 contracts, divided into 11,944 calls and 9,713 puts. The put-call ratio stands at 0.81.
The skew shows a slight upward bias, but it is not extreme, and volatility is likely to occur in both directions.
On the one hand, Ethereum options account for the remaining $34.77 billion. ETH is trading around $2,958, significantly below the maximum pain point of $3,200.
Open interest is substantial in absolute terms, with 117,513 contracts remaining. There are 63,796 calls and 53,717 puts, resulting in a put-call ratio of 0.84. Similar to Bitcoin, positioning reflects cautious optimism while maintaining preparedness for downside risks.
Moreover, this week's expiration options are at a slightly lower level compared to last week's approximately $300 billion.
Caution is advised regarding Deribit, strike concentration, and high volatility due to macro risks.
According to Deribit analysts, open interest clustering at key strikes is increasing short-term price sensitivity.
"Positioning around key strikes is dense, and the spot price becomes highly sensitive right before the cut. Geopolitical risks and uncertainties in trade policy remain macro factors supporting hedge demand, and volatility responses are also maintained. Attention should be paid to the 'magnet effect' of strike prices, dealer hedge flows, and movements in volatility reassessment post-expiration," the company notes.
This dynamic reflects a broad market environment where macro risks continue to dominate trader psychology.
Ongoing geopolitical tensions, changing trade policies, and uncertainty in global monetary policy have made investors more reliant on hedging via options rather than direct bets on direction.
As a result, even if the spot price remains relatively stable, implied volatility (IV) remains elevated, and a reactive tendency continues.
Around expiration, the so-called 'strike magnet' exerts gravitational pull on prices, forcing dealers to adjust hedges aiming for delta neutrality.
As the spot price approaches the maximum pain level, hedge flows reinforce that movement. Conversely, if it deviates significantly from key strikes, rapid position reconstruction may occur, which could not only suppress volatility but even amplify it.
Once expiration is reached, market interest will shift towards how volatility is reassessed heading into the weekend. Large expirations may release accumulated gamma exposure, potentially leading to significant price movements as the market readjusts post-expiration.
Therefore, there is a possibility of renewed directional strength in the Bitcoin and Ethereum markets. If selling pressure recedes, a relief rally may occur; conversely, if macro concerns resurface, the situation may tilt towards a decline.
Today's expiration, with extremely dense positions, unresolved macro risks, and clear technical levels, could determine the tone for the next developments in the BTC and ETH markets.
