$6.5 billion in Bitcoin options expires on Friday! Nearly 90% of long bets on BTC have exceeded 70,000

With the passage of the Ethereum spot ETF and the changing stance of U.S. presidential candidates on cryptocurrencies, the cryptocurrency market seems to be gradually recovering, with Bitcoin rising from the $57,000 level at the beginning of this month. It rose to a maximum of about $71,000, an increase of 24.6%.

Currently, Bitcoin is fluctuating at a high between US$68,000 and US$70,000. It was temporarily trading at US$68,556 at the time of writing, down 0.2% in the past 24 hours. It remains to be seen when it will take a clear direction.

Bitcoin bulls are too optimistic, betting more than $70,000

However, judging from the option data expiring at the end of this month, many investors are more optimistic about Bitcoin’s rebound this month. expected. According to data from the options trading platform Deribit, nearly 90% of Bitcoin options due to expire on May 31 have exercise prices set at US$70,000 or above. It shows that most investors are betting that Bitcoin will rise significantly before the end of May.

Since the current market price of Bitcoin is about US$68,500, the gap between the exercise price of these bullish investors and the market price is still some distance away, which means that unless there is a larger increase, otherwise these bullish investors will The buy call is likely to be invalid after expiration, causing investors to lose their premium.

Currently, the data on Bitcoin options expiring on May 31 on Deribit are as follows:

A total of US$4.693 billion will expire (if other exchanges are included, the total will be US$6.5 billion), buy The option put ratio is 0.6

• Max Pain is $65,000

• Max Pain of the option ” refers to the price at which the buyer’s overall loss is the largest (that is, the seller’s overall profit is the largest) when the option expires.

The BTC options that are about to expire on the 31st

exceed $70,000, and BTC bulls will have a potential profit of $270 million

Further analysis, on May 31, if the price of Bitcoin remains around $67,800, the situation in the options market is as follows:

• The call option is not closed The total value of the warehouse contracts will reach approximately US$135 million.

• The total open interest value of the put option at $68,000 is approximately $145 million.

Such a configuration is relatively balanced, which means that the market’s expectations for a clear direction of price are not strong. However, both bulls and shorts have sufficient financial incentives to push the price in their favor before the option expires (shorts usually have the stronger influence).

Here are two scenarios:

• If the price of Bitcoin falls to $65,900, the put has a profit potential of $95 million

• Conversely, if the price rises to $70,000 or higher, the call option can gain up to $270 million in potential benefits

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