Bitcoin (BTC) and Ethereum (ETH), the two largest cryptocurrencies, face a combined $10 billion U.S. options contract expiration on June 28.
Bitcoin options contracts worth $6.68 billion U.S. and Ethereum options worth $3.5 billion U.S. are set to expire as the second quarter and first half of the year draws to a close.
The looming options expiries represent more than 40% of the open interest of over $23 billion U.S. in Bitcoin and Ethereum.
Large quarterly options expiries frequently cause volatility due to higher trading volumes and the closing out of traders’ positions.
Options are contracts that give the holder the right but not the obligation to buy or sell an asset at a pre-determined price on or before a set date.
A “call” option is typically a bullish bet that an asset’s price will rise, while a “put” option is a bet that the price will decline.
On Wall Street, options contracts are usually set-up to expire at the end of each quarter as traders take profits and tally their wins and losses for the previous three months.
Bitcoin, which is the largest cryptocurrency by market value, has seen its price fall nearly 10% in June. BTC is currently trading at $61,300 U.S.
Ethereum’s price has sunk 12% over the past month to trade at $3,375 U.S. per token.
June 28 is the final trading day of the month, quarter, and year’s first half.
