- Bitcoin options worth $18 billion expired today, marking a new record.
- Analysts from Bitfinex expect market volatility may not happen immediately but within the next 24-72 hours.
- More than half of traders on Myriad predict lower Bitcoin prices this weekend.
- October Bitcoin options open interest stands at $78.9 billion, with heavy bets on prices between $115,000 and $125,000.
- Large positions in the options market may lead to sharp price swings due to dealer hedging.
A record-setting $18 billion in Bitcoin options expired today, a development that could affect the cryptocurrency’s price direction over the next three days. The options expiry took place amid weak market conditions, with many traders bracing for more price changes shortly after the contracts settle.
Data from Bitfinex analysts suggests that large expiries like this often keep price swings low right before their close, followed by a clearer move in the subsequent 24 to 72 hours. Current market sentiment remains cautious, as most users on prediction site Myriad favor a bearish outlook, with 51% expecting more daily losses for Bitcoin over the weekend.
Options are contracts that allow traders to buy or sell Bitcoin at set prices by a certain date. Call options speculate on prices rising, while puts wager on prices falling. Bitfinex emphasized that as the notional value of expiring contracts increases to tens of billions, it can cause market volatility as traders adjust their risk.
Looking ahead, open interest in Bitcoin options remains elevated. As of today, Coinglass reported $78.9 billion in outstanding Bitcoin contracts, with significant activity concentrated in October and strike prices between $115,000 and $125,000.
On major exchange Deribit, more than $8 billion in Bitcoin options are due to expire at the end of October. Bitfinex analysts noted that the market displays “long convexity”—meaning traders with these options could see substantial gains if Bitcoin rallies sharply, while dealers who sold these contracts might need to hedge their positions aggressively.
This hedging activity could result in increased volatility, with dealers buying as prices rise and selling as they fall, leading to rapid price shifts. If the structure holds, upward momentum in Bitcoin may be contained unless significant external factors intervene.
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