bitcoin Approximately $7.9 billion worth of options will expire on Deribit this Friday, with positioning data pointing to $62,000 and $75,000 as key levels to watch.
The $75,000 level is where most of the call options trading has occurred, representing bullish bets, according to data source Glassnode. Around $395 million in call open interest is concentrated in the $75,000 strike at the time of writing. That figure represents the dollar value of the number of active call option contracts currently.
More importantly, “gamma exposure” is deeply negative at the 75,000 strike: it means that traders’ hedging flows are likely to amplify price movements around this level. As the price goes up, they may need to buy more and as it goes down, sell more, reinforcing the direction of the move.
As a result, the 75,000 level may act as an area of higher volatility, where price swings become more pronounced rather than stabilizing.
Options are derivative contracts that give the buyer the right to buy or sell the underlying asset, in this case BTC, at a predetermined price at a later date. A call option gives the right to buy and a put option gives the right to sell.
It’s like paying a reservation fee to reserve the right to transact a house at the current price: you have the right to buy or sell it later at that price, but you are not obligated to transact if the market price moves against you.
On the negative side, the highest concentration of open sales interest is at $62,000, with approximately $330 million in contracts, marking the main area of downward protection.
Between the two, there is this maximum pain level of $71,000, which can act as a tycoon heading into expiration. The “peak pain” point is the price level at which the largest number of options contracts are expected to expire worthless on the settlement date, although this level can change as prices and open interest before expiration change.
All in all, the options market is effectively between $62,000 and $75,000, with $71,000 acting as the midpoint. Unlike in March, when bitcoin was trading below maximum pain, the market is now above it, to test whether bitcoin can maintain its gains.
Possible short squeeze to the upside
Funding rates on perpetual futures have remained negative, indicating an accumulation of short positions that could trigger a squeeze if prices remain higher. Bears could square their bearish bets if prices remain resilient above $75,000, which could increase bullish momentum.
While Checkonchain data shows that Deribit now has around $31 billion in open interest, the largest in all options markets, surpassing even BlackRock’s IBIT, which is close to $28 billion.
