On Thursday, Bitcoin (BTC) retested the $72,500 level for the first time in six weeks, triggering $342 million in liquidations of bullish positions. Although the price later rose to $73,500, traders are concerned that bears may take control ahead of the expiration of $9 billion in monthly options, reports Cointelegraph.com reports .
Deribit exchange controls 70% of the end-of-May options market. Currently, there is $3.4 billion in open interest for call options and $2.91 billion for put options. However, the drop in Bitcoin's price below $78,000 on May 17 caught many investors off guard. If the price remains below $74,000 by Friday's expiration, only $306 million worth of call options will be profitable.
Conversely, the volume of put options targeting $74,000 or higher stands at $1.05 billion, giving the bears a significant strategic advantage. Even if Bitcoin recovers to $74,000 by Friday, put options will still outweigh call options by $265 million. On the positive side, demand for protection against a sharp price drop is currently not excessive.
The put-to-call ratio for Bitcoin options was recorded at 0.8 on Thursday. This means $1.29 billion in put options were traded against $1.57 billion in call options. This neutral stance is an improvement compared to last week's high demand for hedging strategies. Nevertheless, the June 26 expiration indicates that traders are not particularly inspired by Bitcoin's short-term prospects.
Currently, the $80,000 June call option is valued at 0.0103 BTC (approximately $757). Given that there are 28 days left until expiration, the probability of Bitcoin's price rising above this level is estimated at around 18%. This pessimistic sentiment is partly linked to the $1.07 billion in net outflows from spot Bitcoin ETFs in the U.S. over two days.
Read “Zamin” on Telegram!
