Bulls and bears are equally nervous about the possible outcome of the June 25 $1.5 billion Ethereum options expiry. On June 25, Ether (ETH) will face its largest options expiry in 2021 as $1.5 billion worth of open interest will be settled. This figure is 30% larger than March's 26 expiry, which took place as Ether price plunged 17% in 5 days and bottomed near $1,550.
However, Ether rallied 56% after March's options expiry, reaching $2,500 within three weeks. These moves were completely uncorrelated to Bitcoin's (BTC). Therefore, it is essential to understand if a similar market structure could be underway for June 25 futures and options expiry.
On March 11, Ether miners organized a "show of force" against EIP-1559, which would significantly reduce their revenues. The situation worsened on March 22, as CoinMetrics launched an "Ethereum Gas Report," stating that the highly anticipated EIP-1559 network upgrade would unlikely solve the high gas problem.
Things started to change on March 29, as Visa announced plans to use the Ethereum blockchain to settle a transaction made in fiat, and on April 15, the Berlin upgrade was successfully implemented. According to Cointelegraph, after Berlin launched, "the average gas fee began to decline to more manageable levels."
Before jumping to conclusions and speculating whether these phenomena of the Ether price bottoming near the upcoming $1.5 billion options expiry are bullish or bearish, it's best first to analyze how large traders are positioned. Take notice of how June's expiry holds over 638,000 ETH options contracts, totaling 45% of the aggregate $3.4 billion open interest.
Unlike futures contracts, options are divided into two segments. Call (buy) options allow the buyer to acquire Ether at a fixed price on the expiry date. Generally speaking, these are used on neutral arbitrage trades or bullish strategies. Meanwhile, the put (sell) options are commonly used to hedge or protect from negative price swings.
As displayed above, there's a disproportionate amount of call options at $2,200 and higher strikes. This means that if Ether's price on June 25 happens to be below this level, 73% of the neutral-to-bullish options will be worthless. The 95,000 call options still in play would represent a $228 million open interest.
On the other hand, most protective put options have been opened at $2,100 or lower. Consequently, 74% of those neutral-to-bearish options will become worthless if the price stays above this level. Therefore, the remaining 73,700 put options would represent a $177 million open interest.
It seems premature to call who might be the winner of this race, but considering Ether's current $2,400 price, it looks like both sides are reasonably comfortable. However, traders should keep a close eye on this event, especially considering the price impact that surrounded the March expiry.
|#||Crypto||Prediction||Accuracy||CVIX||Price||24h||7d||Market Cap||7d price change|
|1||BTC||Bitcoin predictions||75.2%||50||$48 706.73||-9.26%||-10.81%||$920 132 432 479|
|2||ETH||Ethereum predictions||82.4%||33||$4 059.61||-3.80%||-0.61%||$481 495 723 238|
|3||BNB||Binance Coin predictions||82%||32||$562.06||-5.77%||-6.99%||$93 752 606 143|
|4||USDT||Tether predictions||94%||1||$0.999843||-0.04%||-0.10%||$74 146 017 092|
|5||SOL||Solana predictions||69.2%||62||$200.85||-6.55%||3.29%||$61 387 860 524|
|6||ADA||Cardano predictions||64.8%||72||$1.41||-10.52%||-9.18%||$46 958 385 031|
|7||USDC||USD Coin predictions||95.6%||2||$0.999385||-0.03%||-0.05%||$39 796 534 169|
|8||XRP||XRP predictions||65.6%||70||$0.834001||-10.39%||-11.92%||$39 404 303 399|
|9||DOT||Polkadot predictions||62.8%||76||$29.08||-14.58%||-17.21%||$28 721 201 555|
|10||LUNA||Terra predictions||66.8%||65||$71.05||5.47%||63.77%||$27 565 404 822|
|11||DOGE||Dogecoin predictions||66%||74||$0.175319||-12.61%||-14.55%||$23 209 784 837|
|12||AVAX||Avalanche predictions||64.8%||73||$90.70||-14.60%||-19.51%||$22 013 847 272|
|13||SHIB||SHIBA INU predictions||64.8%||73||$0.000037||-9.62%||-5.62%||$20 243 352 002|
|14||CRO||Crypto.com Chain predictions||57.6%||86||$0.595382||-5.97%||-25.47%||$15 041 152 356|
|15||BUSD||Binance USD predictions||96%||1||$0.999915||0.09%||-0.01%||$13 732 244 013|
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