$2.2B Options Expiry Puts Bitcoin and Ethereum on Volatility Watch
The crypto derivatives market is heading into 2026 with a major test in store for traders - a whopping $2.2 bn in Bitcoin and Ethereum...
Quick overview
- The crypto derivatives market faces a significant test in 2026 with $2.2 billion in Bitcoin and Ethereum options set to expire.
- Bitcoin options dominate the expiries with $1.87 billion outstanding, indicating a bullish sentiment among traders.
- Ethereum's options show a more balanced positioning, but still reflect optimism rather than fear of a downturn.
- The outcome of these expiries could significantly influence short-term price behavior and trader sentiment moving forward.
The crypto derivatives market is heading into 2026 with a major test in store for traders – a whopping $2.2 bn in Bitcoin and Ethereum options that are about to expire. After the wild ride that was 2025 this will finally give us a clearer picture of how traders are assessing risk as we enter the new year.
The major chunk of those expiries belong to Bitcoin , with a eye-watering $1.87 bn in notional value outstanding. Right now BTC is trading at around $88,970 – which is slightly above that magic $88,000 max pain figure where people who’ve written options are probably waking up with a nasty case of regret. Have a look at the open interest numbers which show 14,194 calls vs 6,806 puts and you’ll see 21,000 open contracts in total with a put to call ratio of just 0.48 – which looks like the market’s got more of a appetite for the upside rather than hedging against a fall.
The smaller portion is in Ethereum where a respectable $395.7 mn in expiring options are waiting in the wings. ETH is trading at around $3,020 which puts it comfortably above its estimated $2950 max pain level. Positioning looks a bit more balanced than in Bitcoin but still telling us traders are looking to the positives rather than being fearful of a downturn.
Over $2.2 Billion in Bitcoin and Ethereum Options Expire as 2026 Begins:
More than $2.2 billion worth of Bitcoin and Ethereum options are set to conclude today, marking the first broad-based derivatives settlement of 2026. pic.twitter.com/hcWRT1mkCA
— Gerla (@CryptoGerla) January 2, 2026
Are People Just Too Optimistic?
When we take a closer look at the options data it’s clear that traders aren’t preparing for a sharp spike down in either asset. Ethereum’s open interest is a respectable 130,955 contracts – split roughly 50-50 between calls and puts giving us a put to call ratio of 0.62. That suggests a fair amount of ongoing hedging but not the “oh no its going to crash” type protection.
A bunch of other flow metrics are telling us the same story – with Bitcoin block trade volume showing 36.4% in calls while puts only get 24.9% – so it looks like there’s limited demand for downside coverage.
Meanwhile Ethereum calls represent 73.7% of block volume which is just a clear sign that the market’s got its heart set on going up. Another interesting fact is that most of that activity is concentrated in March and June expiry months – which is a sign that folks think prices will keep climbing over the coming months.
Why This Is Important for Volatility
The reality is that these large option expiries can often have a pretty big impact on short-term price behaviour as people roll off old positions or adjust them. Markets often tend to gravitate towards those max pain levels but if prices are already above them – it can actually increase the sensitivity of prices to actual moves.
If prices keep going up – people are going to have to rebalance their exposure – which can end up amplifying any upside momentum they get. On the flip side – if the market starts to drop – all those people who got a bit too cocky about the price might end up needing to unwind positions in a hurry.
A few things to keep an eye on in the coming days include what happens to hedging activity after settlement passes, how people migrate into longer-dated contracts, how much gamma-driven flows there are when there’s a sharp move – and how liquidity dries up during the rollover periods.
It looks like at this point in time we are over exposed on the upside but after this first major derivatives reset of 2026 we might actually get a clearer sense of how traders are viewing risk and volatility for the months ahead.
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