Are we in for disruptions in the cryptocurrency market? A comprehensive analysis of the impact of options expiration on BTC and ETH.
The cryptocurrency market is bracing for a wave of volatility as the expiration of Bitcoin (BTC) and Ethereum (ETH) options contracts approaches today, Friday, July 18, 2025. The total value of these contracts exceeds $5.76 billion, compelling traders and investors to prepare well for possible scenarios. Historically, markets tend to experience some disruptions before stabilizing again after options expiration, as traders adapt to the new trading environment.
Details on Bitcoin options expiration: Cautious optimism
For Bitcoin, total open interest stands at 40,945 contracts, representing a massive notional value of $4.91 billion. Notably, the maximum pain point, the price at which most options expire worthless, is $114,000. This is significantly lower than the current BTC trading price of around $120,259 (at the time of writing).
With a put-to-call ratio of 0.78, it seems that Bitcoin traders are leaning towards the upside, favoring call options that profit from rising prices. This indicates cautious optimism regarding Bitcoin's short-term future, although the price may see some pullbacks as expiration approaches to reach the maximum pain point.
Ethereum Market: A More Neutral Tone
Conversely, the Ethereum options market shows a more neutral tone. Open interest stands at 237,466 contracts with a notional value of $851 million. With a put-to-call ratio of 1.01, there is an almost balanced sentiment between bearish and bullish bets, reflecting a lack of clear and unified direction among traders. The maximum pain level for ETH is $2,950, which is also significantly lower than the current market range.
It is noteworthy that the options contracts expiring this week are slightly higher than those of last week. On July 11, 36,970 Bitcoin contracts expired with a notional value of $4.31 billion, along with 239,926 Ethereum contracts worth $712 million. This growth in contract volume indicates increasing trader interest in the derivatives markets.
Traders strategies and anticipated volatility
Analysts at Greeks.live describe the overall market sentiment as 'mixed'. While some traders believe the market has peaked following recent highs, others still target higher valuations later in the year, expecting Bitcoin to reach $150,000 by the fourth quarter, with a correction anticipated until September.
In the near term, traders are using 'risk reversal' strategies, which involve selling put options and buying call options, expressing a bullish stance while adding small short positions to hedge against any 'black swan' events (sudden shocks). This strategy indicates that market participants expect the upward trend to continue but remain cautious about any sudden downward shocks.
Implied volatility remains the key focus. For Ethereum, implied volatility continues to hover around 70% even after the recent price increase, creating opportunities for fundamental trades and volatility plays.
In conclusion, with both assets trading above maximum pain levels, Bitcoin and Ethereum prices are likely to experience some pullback as the expiration of these options approaches. However, the market is expected to stabilize afterward as traders adapt to new trading environments. American Democratic lawmakers described cryptocurrencies as a 'blatant scam' during a press conference held on Wednesday, calling for the development and launch of a Central Bank Digital Currency (CBDC).
