Bitcoin’s $6.1 billion option expiration is not enough to break bearish sentiment

Bitcoin (Bitcoin) The price has been between US$46,000 and US$52,000 for 26 days. Although the notional value of year-end options is as high as US$6.1 billion, the bullish and bearish instruments are balanced between US$44,000 and US$49,000.

Therefore, it is not surprising that the price of $47,175 at 8:00 AM UTC on December 31 has little changed to the price structure. Even the 3% rebound to $48,500 after the incident failed to sustain themselves, which shows that the bears are unwilling to give up their advantage.

Bitcoin/USD price on Coinbase. Source: TradingView

The bulls may have explained 9,925 BTC leaves Coinbase As a positive trigger within 24 hours, considering that newcomers can obtain fewer tokens on the exchange. In addition, for the past four years, the first week of this year has been positive, with an average return of 18.5% for Bitcoin holders.

To further support the bullish argument, U.S.-listed technology companies MicroStrategy adds another 1,914 BTC Balance sheet as of December 30.On the downside, regulation continues to put pressure on the market because Korea Exchange Users are required to verify their third-party wallet address to comply with the Financial Action Task Force (FATF) travel rules guidelines.

Regardless, Bitcoin will perform well in 2021

Regardless of the short-term bearish sentiment behind the 16% price drop in December, Bitcoin continues to outperform the market sharply For the third consecutive year, US stocks and gold have both remained flat. However, with the lower expiration price on December 31, this performance is not enough to prevent every $48,000 and higher call (buy) option instrument from becoming worthless.

Bitcoin options aggregates open positions on December 31. Source:

At first glance, the $4 billion call (buy) option performs significantly better than the $2.1 billion put (sell) instrument, but the call option ratio of 1.9 is deceptive because the price is lower than the November closing of $57,000 The price fell by 16% with a bullish bet. Therefore, if the transaction price of Bitcoin is lower than that price, the right to buy Bitcoin (call option) at a price of $50,000 has no value.

The long and short tools are equally divided at the expiration of the Bitcoin option on December 31, and their price is much lower than the expected $660 million. However, the bears have no control because 85% of their bets are $47,000 or less. Such data partly explains why the bulls are trying to regain momentum after expiration on December 31.

Can the first week of 2022 finally reverse the mild negative sentiment that has prevailed since the crash on December 3? Unfortunately, according to the Bitcoin options market, there is no sign that the trend has changed.

The views and opinions expressed here only represent author It does not necessarily reflect the views of Cointelegraph. Every investment and transaction involves risks. When making a decision, you should conduct your own research.

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