– About $3 billion of BTC options and $1.8 billion of Ether options are set to expire on Sept. 29
– The expiration date is significant as it marks the end of the month and the quarter
– Crypto market and traditional finance approach options expiries in a similar manner, leading to increased trading volumes and volatility
– The Bitcoin Volatility Index has increased over the past month, though it is currently near all-time lows
– Market makers adjust their hedges, leading to amplified market volatility before options expiry
– Current conditions may not result in strong market moves
– Institutional players on Deribit derivatives exchange frequently adjust their hedge positions, potentially impacting BTC prices and market volatility
– Options allow investors to hedge their positions and speculate on price movements
– This information is provided for informational purposes only and is not intended as advice.
There is expected to be increased volatility in the cryptocurrency market in the coming week due to the expiration of approximately $3 billion worth of bitcoin options and $1.8 billion worth of ether options on September 29. The end of the month and the quarter often lead to significant trading volumes and volatility. Market makers, who adjust their hedges based on changes in the price of the underlying asset, can contribute to amplified market volatility. However, current conditions may not result in strong market moves. Institutional players, such as those on the Deribit derivatives exchange, often employ advanced strategies around options expiries to manage volatility and hedge their exposure, potentially impacting bitcoin prices and market volatility. Bitcoin’s price has remained relatively flat over the past month. Options are derivative contracts that give the purchaser the right to buy or sell the underlying asset at a predetermined price on or before a specific date, and they are used for purposes ranging from hedging to speculation.
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