Bitcoin investors (BTC) are preparing for the expiration of monthly options of $ 16.5 billion on March 28.
This change gives Bitcoin has a crucial opportunity to escape a potential loss of $ 3 billion, a factor that could considerably influence market dynamics in the coming weeks.
Bitcoin options open interest in March 28, USD. Source: laevitas.ch
Currently, total interest options open for the call (ACHER) amount to $ 10.5 billion, while options (sale) are lagging around at $ 6 billion. However, $ 7.6 billion in these calls are set at $ 92,000 or more, which means that Bitcoin would need 6.4% of its current price to make them viable by the expiration of March 28. Consequently, the advantage of the bullish bets has been considerably weakened.
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Some analysts attribute the low Bitcoin performances to the current world tariff war and to the reductions in the US government spending, which increases the risk of economic recession. Merchants are concerned about slower growth, especially in the artificial intelligence sector, which had led the S&P 500 to a record on February 19 before dropping by 7%.
Future S&P 500 (left) vs Bitcoin / USD (right). Source: tradingView / Cointelegraph
Meanwhile, Bitcoin bulls hope to decoupage from the scholarship, despite the correlation of 40 days of respect for 70% since early March. Their optimism stems from the expansion of the monetary base by central banks and the increased adoption of Bitcoin by companies such as GameStop (GME), Rumble (Rum), Metaplanet (Tyo: 3350) and Semler Scientific (SMLR).
As the expiration of options is approaching, bulls and bear each have a strong incentive to influence the punctual price of Bitcoin. However, while Haussiers investors are targeting levels above $ 92,000, their optimism alone is not enough to guarantee that the BTC exceeds this brand. Deribit leads the options market with a share of 74%, followed by the Chicago Mercantile Exchange (CME) at 8.5%and Binance at 8%.
Given the current market dynamics, Bitcoin Bulls has a strategic advantage before the expiration of monthly options. For example, if Bitcoin remains $ 86,500 at 8:00 a.m. UTC on March 28, only $ 2 billion in put options (sale) will be at stake. This situation encourages the guarantees to lead Bitcoin below $ 84,000, which would increase the value of the PUT options active to 2.6 billion dollars.
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Bitcoin Bulls will have the advantage if the BTC price spends $ 90,000
Below are five probable scenarios based on current price trends. These results estimate the theoretical benefits based on imbalances in open interests but exclude complex strategies, such as the sale of power options to win an exposure to upward prices.
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Between $ 81,000 and $ 85,000: $ 2.7 billion in calls (buy) compared to $ 2.6 billion in puts (sale). Net profit promotes call instruments of $ 100 million.
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Between $ 85,000 and $ 88,000: $ 3.3 billion for $ 2 billion compared to $ 2 billion, promoting calls of $ 1.3 billion.
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Between $ 88,000 and $ 90,000: $ 3.4 billion for calls compared to $ 1.8 billion. Promote calls by $ 1.6 billion.
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Between $ 90,000 and $ 92,000: $ 4.4 billion in calls against $ 1.4 billion is, promoting calls of $ 3 billion.
To minimize losses, bears must push Bitcoin below $ 84,000 – a decrease of 3% – before the expiration of March 28. This decision would increase the value of put options (sold), strengthening their position.
Conversely, the bulls can maximize their gains by driving the BTC above $ 90,000, which could create enough momentum to establish an upward trend for April, especially if the entries in the negotiated funds in exchange for bitcoins (ETF) resume at a strong rate.
This article is for general information purposes and is not intended to be and must not be considered as legal or investment advice. The points of view, the thoughts and opinions expressed here are the only of the author and do not reflect or do not necessarily represent the opinions and opinions of Cointellegraph.
