In a tweet on Monday, the cryptocurrency data provider Skew, reported These 102,200 Bitcoin options will expire on December 25th.
Options contracts allow their holders to buy or sell Bitcoin at a specific price known as the “strike” or strike price. The December 25 expiration has notable clusters around the strike price of $ 15,000 and the strike price of $ 20,000, according to Skew.
The expiration date of bitcoin options contracts is widely viewed as a volatile event for the flagship cryptocurrency as holders adjust their contracts as it expires. Profit traders can also choose to get paid and lower the price of the cryptocurrency.
It is known to cause such events large fluctuations in the value of Bitcoin. Typically, the impact of a contract on the price of BTC becomes most evident around a day or two before it expires.
Crypto derivatives trading has exploded this year as more traders and institutional investors seek additional exposure to Bitcoin. Last week the crypto derivatives platform, Deribit began offering Bitcoin futures with an exercise price of $ 100,000 that will expire on September 24, 2021. In other words, Bitcoin enthusiasts who believe that the cryptocurrency will reach six figures can now make this bet on the futures market. .
Bitcoin is currently in the middle of a bull market, partly driven by institutional investors and large off-market trades. Despite the expected volatility in futures, there is a good chance that Bitcoin will continue to be well supported by institutional demand and increased calls. “Illiquid Wallets” – that is, addresses that have sent less than 25% of the BTC they ever received. Chainanalysis estimates that illiquid wallets hold 77% of the 14.8 million BTC mined that were not lost.
Bitcoin (BTC) futures worth around $ 2.3 billion will expire on Christmas Day, paving the way for a volatile week in the cryptocurrency market.