Bitcoin derivatives markets are signaling new bullishness with Bitcoin options open interest (OI) at a record high of $63 billion, dominated by higher strike prices, according to Coinglass.
OI also hit an all-time high of $50 billion on crypto options exchange Deribit, “with puts at $100K gaining traction,” reported the Coinbase-owned derivatives platform on Thursday.
Deribit is the world’s largest crypto options exchange, with around 80% of the total OI. Open interest refers to the number or value of all outstanding options contracts that have yet to expire or be settled.
Record highs mean high engagement in crypto derivatives markets as traders are actively positioning for major price moves, suggesting heightened conviction about Bitcoin’s near-term direction.
Bullish Strike Prices Dominate
Deribit noted an increase in OI at the $100,000 strike prices, which is now around $2.17 billion, with bears betting on a fall in Bitcoin.
However, there is much more OI at higher strike prices, with more than $2 billion at $120,000, $130,000 and $140,000 strike prices, according to Deribit.
When OI concentrates at strike prices well above current levels, it indicates traders are predominantly betting on or hedging for substantial upside. This suggests strong bullish sentiment and expectations for continued price appreciation.
“While put OI has increased at key downside strikes, there’s notable call activity building around 120K and above, suggesting traders are positioning for potential upside volatility or gamma exposure,” said Luuk Strijers, CEO of Deribit.
$5.1 Billion of Bitcoin Options to Expire
Around $5.1 billion worth of BTC options will expire today on Deribit. They have a put/call ratio of 1.03, which means long and short contract sellers are evenly matched.
There is a max pain point of $114,000, the strike price at which most contracts will make a loss.
“Positioning is balanced, with puts outweighing calls a bit. Traders are hedging downside but not positioning for a major sell-off,” reported Deribit.