- Bitcoin maintained a balanced Put/Call ratio before the deadline
- ETH traders are facing potential losses as the price was close to the maximum pain point
According to data from Deribit, the market-leading derivatives exchange, Bitcoin [BTC] options with a notional value of $1.18 billion expire on May 17.
Also Ethereum [ETH] contracts, worth $950 million, were due to expire on the same day. At the time of writing, the Put/Call ratio for Bitcoin was 0.61, while the maximum pain point was $62,500.
Source: Deribit
Where are both BTC and ETH?
In options trading, a put means that a trader has placed a position to place a contract for sale. In this case, the expectation is that the price of the asset will fall so that the position can make a profit.
On the other hand, a call implies a purchase, indicating that the bet is on a price increase. If the put/call ratio is 0.70 or higher, it means traders are buying more puts than calls.
Conversely, a reading of 0.50 and below implies bullish sentiment in the market. For Bitcoin, the ratio revealed that the number of put and call positions were close, indicating a balance between bearish and bullish positions.
For ETH, the Put/Call ratio was 0.21 – a sign that most bets were bullish. ETH had a maximum pain point of $3,000. If the cryptocurrency trades at this level or lower by the end of the day, many traders could face huge financial losses.
Source: Deribit
It would be the same for Bitcoin if the price reached or fell below $62,500. At the time of writing, Bitcoin’s price was $66,443, indicating that it could be difficult for the crypto to cause much pain.
However, at the same time, ETH was valued at $3,018. Because this is so close to the maximum pain point, ETH traders are at high risk of losing.
ETH’s weakness hasn’t deterred future bets
In addition, Greeks.live, an options trading repository, commented about the issue. The handle matched AMBCrypto’s analysis for Bitcoin over X. For Ethereum, it noted:
“BTC is more balanced between long and short, while ETH price is weak, leading to a continued weakening of market confidence, and selling calls have become the absolute focus.”
However, data from Deribit showed that traders expect ETH to recover from its troubles in the future. Based on AMBCrypto’s observations, there has been an increase in bets targeting $3,600 between the last week of May and June.
One of the reasons for this prediction could be the SEC’s impending decision on the numerous Ethereum ETF filings. A kink on this front could push up the price of ETH, and traders could benefit.
Realistic or not, here is the market cap of ETH in BTC terms
On the other hand, delay or rejection could further reduce the price of the altcoin. Should this be the case, traders could face huge financial losses.