Under the pressure of implied volatility of 40-60%, $28 billion worth of options expire simultaneously.

As the cryptocurrency market enters a winter phase, today saw the simultaneous expiration of one of the largest option positions in history, totaling approximately $28 billion.

This massive expiration symbolizes the consolidation phase of Bitcoin and Ethereum throughout Q4. Bitcoin has stabilized around the $90,000 level and is currently trading at $92.56, while Ethereum has settled from below the $3,000 mark to around $3.15.

Expiring Options: Scale and Structure

The breakdown of the positions that expired this time is as follows:

Bitcoin segment: 267,000 options (valued at $23.6 billion) expired. The put-to-call ratio is extremely low at 0.35, indicating a dominant majority of call option holders. The maximum pain point (the price level causing the greatest loss to market participants) is set at $95,000, reflecting traders’ expectations of an upward movement from the current price range.

Ethereum segment: 1.28 million options (valued at $3.71 billion) also reached expiration. The put-to-call ratio is 0.45, continuing to favor call option holders. The maximum pain point is set at $3,100, indicating traders’ bullish stance is reflected in these figures.

Implied Volatility Reflecting Market Sentiment

The current uncertainty in the options market can also be inferred from the levels of implied volatility. Bitcoin options have an implied volatility of 40%, while Ethereum options stand at 60%, maintaining typical annual fluctuation rates. This suggests that market participants currently view the price movements within this range as “normal.”

Current Market Structure and Future Implications

More than half of the overall positions have already been settled, with the largest position now being the quarterly options expiring in March. These are mainly out-of-the-money (more favorable than current prices) call options, indicating that market participants are cautiously optimistic about a medium-term rebound while maintaining a cautious stance in the short term.

Even amid market downturns, the options market continues to efficiently reflect the diverse views of participants.