Key Points
- BTC Max Pain Price is significantly higher than the current price above $87,000.
- Friday's options expiry will add to current market volatility.
This Friday, the crypto market will witness an impressive amount of Bitcoin options expiration. Deribit reported that around $4.9 in Open Interest will expire as BTC recorded a yearly low recently.
Friday's Bitcoin Options Expiry Data
The Max Pain Point is currently at $98,000, and the Put/Call Ratio of 0.989 shows traders are leaning bullish, says Deribit in a post via X. However, BTC's current price suggests the opposite.
BTC options are set to expire on Deribit on February 28 at 08:00 (UTC), amidst a volatile crypto market.
Bitcoin's lengthy consolidation kept Deribit's volatility index (DVOL) in a downward trend throughout this year. But, after the recent market crash and BTC liquidations, DVOL spiked to 52 before retreating below 50.
This translates into a temporary surge in market uncertainty.
BTC's recent price drop below $90,000 triggered huge $1.7 billion losses for BTC holders, while options OTM and traders face significant unrealized losses.
OTM and ITM
Deribit data shows that out of the approximately $5 billion of notional value set to expire this Friday, $3.9 billion or 78% of the amount is due to expire OTM (out-the-money), which means that these contracts will expire worthless. Almost 100% of the calls are OTM - bullish bets.
The remaining $1.1 billion or 22% was ITM (in-the-money), an amount dominated by puts. ITM puts are investors with strike prices above the spot price which means that they hold value.
The current Max Pain Price is at $98,000, more than $10,000 higher than the current BTC price.
The Max Pain Price is the price at which option sellers, usually institutions, achieve maximum profit, while buyers see the greatest amount of losses.
Options Sellers Could Push BTC Price Higher
Considering that the Max Pain Price is significantly bigger than the current BTC price, options sellers could push BTC prices higher, closer to the Pain Price, according to a new post by the Power Trade options exchange.
Currently, BTC is trading above $87,000, following a recent price surge above $89,000 today.
Today, Rekt Capital shared an optimistic prediction with two potential price scenarios for BTC, both leading to a revisit of $93,500.
