The crypto market recorded a slight decline this week, as sentiment weakened following last week's US Securities and Exchange Commission approval of Ethereum ETFs.
Volatility is expected to increase as Bitcoin options contracts with a nominal value of $4.7 billion expire today, May 31.
Bitcoin options expiration:
The contracts that will expire today are estimated at 69,200 contracts, which is a huge value compared to last week, as is usually the case with derivative financial activities at the end of each month, according to the Deribit platform.
The buy-to-sell ratio for these contracts is 0.61, which indicates that there are more sells (long contracts) expiring than buys (short contracts).
The maximum pain point, where most losses are made, is around $65,000, which is $3,500 lower than current spot prices.
Besides Bitcoin's large options pool, there are about $3.7 billion worth of Ethereum contracts expiring today, with these 910,000 contracts having a buy-to-sell ratio of 0.84, indicating a greater balance between long and short contracts than Bitcoin contracts.
Potential impact on the market:
The market usually does not react significantly to options expiration events, but today's expiration represents an important event, especially as it coincides with the monthly closing date.
Currently, the total market value of cryptocurrencies remains relatively stable above $2.66 trillion.
