Bitcoin (BTC) is trading sideways in the $78,000 range. With more than $6.4 billion in BTC options set to expire in a day, analysts say price volatility could increase.
As of 8 a.m. on the 27th, BTC was trading at $78,688.12, down 0.25% from the previous day, according to global cryptocurrency tracker CoinMarketCap. Ethereum (ETH) fell 0.19% to $2,492.87, BNB rose 1.05% to $704.34, and XRP dropped 3.19% to $1.40.
Domestic prices were higher. At the same time on Bithumb, BTC was up 1.11% from the previous day at 109.45 million won. ETH rose 2.15% to 3.468 million won, and XRP gained 2.25% to 1,950 won.
The market is focused on the large options expiry scheduled for the 28th. According to a CoinDesk report on the 26th citing Deribit data, a total of 81,700 BTC options contracts will expire at 5 p.m. Korea time on the 28th. Their notional value is about $6.44 billion, or roughly 20% of Deribit's total BTC open interest.
Call options number 44,639, outnumbering put options at 37,061. Calls are especially concentrated at the $75,000 and $80,000 strikes. BTC's recent surge from $62,000 to around $80,000 has increased the value of call options that allow holders to buy BTC at lower prices. As a result, analysts say hedging trades by market makers ahead of expiry could widen price swings.
Shaun Fernando, chief risk officer at Deribit, said more than $500 million in notional value is clustered within 5% above and below the current BTC price, which could increase BTC buying and selling by market makers ahead of expiry. As market makers buy and sell BTC to reduce the risks that can arise from options trading, price moves could grow larger, he said. Movements could be even sharper if BTC stays near $75,000 or $80,000, or breaks clearly out of that range, he explained.
The Fear and Greed Index from crypto data analytics firm Alternative.me stood at 65, down 9 points from the previous day, indicating "greed." A reading closer to zero signals weakened investor sentiment, while a reading closer to 100 indicates an overheated market.
