Bitcoin options worth approximately $7.9 billion are set to expire on Deribit this Friday, with positioning data pointing to $62,000 and $75,000 as key levels to watch.
According to data source Glassnode, the $75,000 level is where most call option trades, which represent bullish bets, took place. At the time of writing, approximately $395 million in open buying interest is focused on the $75,000 strike. This figure represents the monetary value of the number of call options contracts active today.
More importantly, “gamma exposure” is deeply negative at the 75,000 strike price – this means that traders’ covering flows are likely to amplify price movements around this level. As the price rises, they may need to buy more, and as the price falls, sell more, thereby strengthening the direction of the move.
As a result, the 75,000 level may act as an area of increased volatility, where price fluctuations become more pronounced instead of 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 future 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 trade 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 complete the transaction if the market price moves against you.
In contrast, the largest concentration of open put interest is at $62,000, with approximately $330 million in contracts, marking the primary downside protection zone.
In between, there is that maximum pain level of $71,000, which can act like a tycoon as expiration approaches. The “maximum” point is the price level at which the greatest number of options contracts are expected to expire worthless on the settlement date, although this level may change as prices and open interest change until expiration.
In total, the options market is effectively between $62,000 and $75,000, with $71,000 serving as the midpoint. Unlike March, when bitcoin traded below the maximum level, the market is now above it, testing whether bitcoin can maintain its gains.
Upside Short Squeeze Potential
Perpetual futures funding rates remained negative, indicating a build-up of short positions that could fuel a contraction if prices continue higher. Bears could end their bearish bets if prices remain resilient above $75,000, which could strengthen the bullish momentum.
While Checkonchain data shows that Deribit now holds around $31 billion in open interest, the largest in any options market, even surpassing BlackRock’s IBIT of almost $28 billion.
