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Historic Surge in Bitcoin and Ether Options Market: $20 Billion Cap

Surge in Bitcoin and Ether options market: Historic $20 billion cap

The cryptocurrency options market is experiencing record-breaking volumes, with Deribit dominating 90% of global crypto options activity. The end of the week will see the expiration of options worth $4.5 billion.

Unprecedented rise in the crypto options market

The leading exchange platform, Deribit, is at the center of growing interest in Bitcoin and Ethereum options. Recent data from Swiss firm Laevitas shows that the current open interest value for these options has reached an impressive $20.64 billion.

Comparison with last year

This value approaches the record seen in November 2021 when BTC (Bitcoin) was trading above $66,000. However, the open interest in terms of contracts is currently much higher than during that period. According to Luuk Strijers, Head of Business Development at Deribit, this achievement reflects the phenomenal growth of the market and the increasing attraction towards options.

The power of the options market

To simplify, options are contracts that give the right (but not the obligation) to buy or sell an asset at a fixed price before a given date. These contracts can be used to speculate or protect against price fluctuations.

The record activity suggests that flows in the options market will have an increasing influence on determining the spot price of these cryptocurrencies.

One event to watch out for: options worth $4.5 billion are about to expire on Deribit. These monthly and quarterly expirations can result in high market volatility in the crypto market.

Options worth $4.5 billion are expiring on Friday. This is a particularly high value, with an unusually large percentage expected to expire in the money (ITM) due to recent market developments, which could lead to market action.

Luuk Strijers

According to the data, the majority of open interest for Bitcoin lies in “in the money” call options. This means that these options have a positive intrinsic value, with exercise prices lower than the current Bitcoin price.

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