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Will BTC Price Get Pushed Under $40,000 as $900M Bitcoin Options Expire?

2 mins
Updated by Kyle Baird
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In Brief

  • This Friday will see the expiry of nearly $900 million in Bitcoin options contracts with BTC dipping below $41,000.
  • The put/call ratio for the expiring Bitcoin options contracts is 1.1, indicating an evenly matched bear and bull market.
  • Bitcoin's value has dropped more than 15% since its yearly peak on January 10, potentially falling below $40,000 soon.
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Bitcoin options expiry day is here, and this Friday, we will see almost $900 million in BTC contracts expiring. Moreover, crypto markets continue to decline, with BTC dipping below $41,000 for the first time in a month, but will it fall further?

Around 22,000 Bitcoin options contracts will expire on January 19. This week’s expiry event is smaller than last week’s, which saw $1.68 billion worth of contracts expire with little impact on markets. 

Bitcoin Options Notional Value Falls

The notional value for this week’s tranche of expiring Bitcoin options contracts is $890 million. Moreover, the put/call ratio is 1.1, which means the bulls and the bears are evenly matched, selling long and short contracts.

The max pain point, which refers to the price at which most losses are made, is $44,000. This is roughly $3,000 higher than the current spot market price.

Greeks Live observed that the impact of the Bitcoin spot ETF launches has dissipated. Volatility has dropped sharply, and major term implied volatility (IV) is plummeting, it added. 

Moreover, the put/call ratio reached 1.1 for the first time in the bull market, “indicating that bearish forces prevailed this week.”

Bitcoin open interest by expiry. Source: X/@GreeksLive
Bitcoin open interest by expiry. Source: X/@GreeksLive

The crypto derivatives metric provider added that the long-term outlook is bullish: 

“The passage of the Bitcoin Spot ETF looks to bring a lot of incremental capital to the crypto market in the long run, with the selloff in grayscale and support from other ETFs playing off each other, and the next big flashpoint could be a halving of the hype, which is clearly a bullish tone this year.”

In addition to the Bitcoin options, there are 211,000 Ethereum options about to expire. These derivatives have a put/call ratio of 0.55, a max pain point of $2,500, and a notional value of $520 million.

Read more: How To Trade Bitcoin Futures and Options Like a Pro

BTC Price Outlook 

The ETF hype appears to be fading for spot markets, which have declined 3% on the day to $1.7 trillion. 

Furthermore, Bitcoin has dropped more than 15% since its yearly peak on January 10. The asset is down 3.7% on the day, trading at $41,143 at press time.

BTC/USD 24 hours. Source: BeInCrypto

Furthermore, BTC dropped below $41,000 during early trading in Asia on Friday morning. It is the first time it has dipped to this level since December 18, and is currently teetering at monthly support. 

Further declines will see the asset drop below $40,000 to find support at around $38,000 in a correction that has been widely predicted. 

Read more: 9 Best Crypto Options Trading Platforms

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Martin Young
Martin Young is a seasoned cryptocurrency journalist and editor with over 7 years of experience covering the latest news and trends in the digital asset space. He is passionate about making complex blockchain, fintech, and macroeconomics concepts understandable for mainstream audiences.   Martin has been featured in top finance, technology, and crypto publications including BeInCrypto, CoinTelegraph, NewsBTC, FX Empire, and Asia Times. His articles provide an in-depth analysis of...
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