This Friday, March 7, approximately 29,000 Bitcoin options contracts will expire, representing a significant notional value of roughly $2.5 billion. While this week’s expiry is considerably smaller than last week’s end-of-month expiration, it paves the way for a much larger end-of-quarter contract expiry scheduled for March 28.
The anticipated impact on spot markets appears to be minimal at this time, especially as the focus shifts towards the White House crypto summit occurring on the same day. Market participants are likely to be more attentive to developments emerging from this summit than the impending options expiration.
Understanding Bitcoin Options Expiry
This week’s Bitcoin options contracts exhibit a put/call ratio of 0.67, indicating a slight predominance of long (call) contracts compared to shorts (puts). Amidst this backdrop, the open interest (OI)—which assesses the number of contracts yet to expire—remains high, particularly around the $120,000 strike price, amounting to around $1.4 billion according to data from Deribit.
Furthermore, open interest over $1 billion is present at the $100,000 and $110,000 strike prices, while bearish sentiment is evident with $750,000 in OI at the $80,000 and $70,000 levels. As noted by crypto derivatives provider Greeks Live, the prevailing market sentiment remains “predominantly bearish.” Traders are reportedly anticipating further downside and expressing frustration over the market’s extreme volatility and price fluctuations.
Traders have pinpointed the $87,000 to $89,000 range as a key resistance level, with $82,000 cited as a recent bottom. However, there exists significant debate among traders regarding the establishment of a sustainable bottom in the current market conditions.
“Market experiencing extreme price swings with Bitcoin moving $6,000 in a day, creating what traders describe as ‘scam both ways’ price action.”
In addition to Bitcoin, around 223,000 Ethereum contracts are also set to expire today, holding a notional value of $482 million and a put/call ratio of 0.71. Consequently, the combined notional value for today’s crypto options expiry reaches approximately $3 billion.
“Trump tariff announcements (and subsequent reversals) are contributing to market confusion, with many traders sitting out due to unpredictable price action,” Greeks concluded.
Current Market Conditions
Over the last 24 hours, markets have experienced substantial volatility, with total capitalization declining by around $200 billion following an executive order from former President Donald Trump concerning a strategic Bitcoin Reserve.
Bitcoin saw a sharp decline of nearly 6%, dropping from above $90,000 to $85,000 in less than one hour before recovering to around $88,000. The sell-off was partially triggered by comments from White House crypto czar David Sacks, which suggested that the reserve would be funded by Bitcoin already seized by the US government. Retail investors interpreted this as a signal that the US would not be purchasing additional BTC for the strategic reserve, leading to a significant sell-off.
Despite the recovery attempt, the cryptocurrency markets continue to show a bearish trend this Friday morning. Market participants remain on edge, closely monitoring upcoming events and price fluctuations ahead of the significant options expiry on March 28.
The insights presented in this post underscore the complexities that traders face in the current market landscape, particularly in light of anticipated regulatory developments and the significant expiry events on the horizon.
