Bitcoin bears dominate Friday’s $2.1B BTC options expiry with a $585M lead


A total of 53,400 Bitcoin (BTC) options will expire on Friday, May 28th. At first glance, bulls seem to be leading, as the open interest of $ 2.1 billion (buy) to put (sell) option ratio stands at 1.32, favoring the neutral-to-optimistic derivatives.

However, after Bitcoin fell 33% in May, the right to acquire BTC at $ 46,000 and above is essentially worthless, as it remains less than 38 hours before the end.

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Bitcoin price at Coinbase, USD. Source: TradingView

On May 20, Cointelegraph reported that “May 28 will not differ with an open interest of $ 1.95 billion. Although it seems premature to call it, bears are likely to continue to press markets considering there are almost no call options at $ 38,000 or less for next week. “

After a brief rebound over $ 42,000 on May 20, Bitcoin entered another correction after a government statement from China revealed plans to “suppress Bitcoin mining and trading behavior, and resolutely prevent the transfer of individual risk.”

On May 23, the Huobi exchange reportedly halted future trades in mainland China causing further upheavals and pushing Bitcoin below $ 32,000.

Bears gained an advantage after the end of last week

As expected, bears continued to have the advantage of the previous week and were still able to set Bitcoin price below $ 42,000. For the neutral to-optimistic calls, there isn’t much to gain from losing a losing position to next week, so bulls will face a top battle at the end of May 28th.

The previous week’s expiration gains created a place for the bears to further bet on a Bitcoin price remaining below $ 45,000 or $ 50,000.

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Bitcoin May 28 options overall open interest. Source: Bybt

Notice how there are only 2,550 BTC call options at $ 42,000 or less, representing only 8% of the outstanding ones. This notion is equivalent to an open interest of $ 100 million. As previously explained, the call (buy) options at $ 46,000 and up are already worthless.

Meanwhile, bears hit another home run, as most bets were $ 36,000 and up. The 17,600 BTC put (sell) options above such a level represent an open interest of $ 685 million, giving the neutral-to-bearish derivatives an advantage of $ 585 million.

It is worth noting that BTC’s regular trading volumes traded more than $ 10 billion a day. However, the fact that the future and options expire at the same time can accentuate volatility.

Remember that buyers and sellers of future contracts always match. So trying to predict which side will exert more pressure is a futile effort.

Deribit, OKEx and expires on May 28 at 8:00 UTC. The futures and possibilities of CME take place a little later in the day at 15:00 UTC.

The opinions and opinions expressed herein are only those of the author and does not necessarily reflect the views of Cointelegraph. Every investment and business move involves risk. You have to do your own research when you decide.