Over $4.5 billion worth of options contracts are set to expire at 8:00 UTC on Friday, October 27.
The crypto options market is facing a major event today that could lead to increased volatility and shifting prices for major cryptocurrencies like Bitcoin and Ethereum.
According to data from Deribit, over $4.5 billion worth of options contracts in Bitcoin and Ethereum are set to expire at 8:00 UTC on Friday, October 27.
Options give buyers the right but not the obligation to buy or sell an asset at a predetermined price on or before a specific expiration date. As these options reach their expiration date, holders will have to decide whether to exercise their contracts or let them expire worthless.
This could lead to a spike in trading volume and volatility around the expiration time as market participants react to whether large options positions are exercised or not. CoinDesk reported the current open interest in contract terms has increased to $20.64, significantly higher than in November 2021 when BTC was around $66,000.
The impending options expiration comes after a period of positive price movement for top cryptocurrencies. Bitcoin rose from around $26,000 to over $34,000 in recent weeks. This market activity led to increased options trading.
Traders and investors will be closely watching the impact of this historic options expiration as it unfolds today. The $4.5 billion in contracts set to expire represents the scale of the crypto options market today, and how it can drive price action and volatility in underlying assets.
