Bitcoin options worth over $6.3 billion set to expire this Friday on Deribit

Approximately $9.4 billion in cryptocurrency options are set to expire this Friday on the Deribit derivatives exchange.

The majority of the options set to expire are bitcoin contracts, with a notional value of $6.35 billion.  The put-call ratio ahead of Friday's end-of-month expiry is elevated at 0.68 — an increase in the amount of puts versus calls when compared to the previous week. 

Ether options with a notional value of $3.08 billion are also set to expire. However, the condition of ether options reveals a significantly lower number of puts versus calls than the bitcoin ratio. For ether contracts, the put-call ratio is a lower 0.49 ahead of Friday's expiry. A put-call options ratio below one indicates that the call volume exceeds the put volume, signifying bullish sentiment in the market.

Bullish bitcoin $100,000 end-of-year calls

Based on Deribit data, the largest open interest leading up to the year-end expiry consists of calls at a $100,000 strike price. This bullish trade indicates that derivatives players anticipate Bitcoin's value to surpass this price by December.

"We have seen a flurry of bitcoin options activity around the year-end expiry as investors begin to position for a post-halving resumption of the uptrend and a breakout from this two month long consolidation," QCP Capital analysts said.

The sentiment inferred from the positioning of options for the end-of-year expiry corresponds with Tuesday's analyst note from Standard Chartered, which fixed an end-of-2024price of $150,000 for bitcoin and $8,000 for ether.

Options are derivative contracts that give a trader the right but not the obligation to buy or sell the underlying asset at a predetermined price on or before a specific date. A call option gives the right to buy, and a put offers the right to sell. It is assumed that a trader who buys put options is implicitly bearish on the market, while a call buyer is bullish.