An amount close to $ 750 million US dollars covers the Bitcoin options that will expire this October 30. According to the data shown by Skew.com, in addition to the main cryptocurrency, Ethereum options are also in similar condition.
In this way, the price of the two digital currencies could reach an important volatility range. It should be taken into account that the price of Bitcoin, in the last days, reached its top of this 2020 exceeding $ 13,800 USD. This rise could have been caused by several factors.
The first of them, PayPal’s announcement to offer tools for handling cryptocurrencies on its platform. The second, for its part, comes from leaked information about the digital currency exchange platform to be launched by Singaporean bank DBS, one of the largest in Asia.
Although the DBS page mistakenly published the information of its crypto platform and immediately deleted it, it was registered in the web.
Could Bitcoin Options Bring Volatility?
As highlighted above, the expiration of Bitcoin options reaching $ 750 million USD could bring a lot of volatility. Although the most popular of the cryptocurrencies seems to show a solid rise in its price, by the end of this week there could be some fluctuations due to the aforementioned volatility.
The aforementioned analysis platform Skew.com, published in his account on the social network Twitter, that some 60 thousand options expire next Friday. The expiration of these options, coincidentally, coincides with the anniversary of the launch of White paper of Bitcoin by Satoshi Nakamoto on October 31, 2008.
At the time of writing this information, the price of Bitcoin is $ 13,300 USD. Although it is not known to what extent, the expiration of the Bitcoin options could affect their value, nervousness could start to play its part in a few hours.
So far, investors have shown enthusiasm due to the bull run of the digital currency. It is the analysts who have sounded the alarms in the face of what they call an imminent fluctuation in the price of the two main cryptocurrencies, Bitcoin and Ethereum.
Parallel to the information from Skrew, the exchange platform where the majority of contracts regarding Bitcoin options are hosted, Deribit, has also spoken in alarm. This exchange, stated in an article, that there is a “commercial uncertainty”Related to this fact.
Aside from the issue with Bitcoin options close to expiring, volatility could also be driven by the US elections. As is known, the elections in that nation, which are just a few days away, are among the most controversial in recent history, which has caused nervousness in almost all markets.
In this sense, Deribit, ensures that, although prices are expected to rise sharply for some time, volatility will come. The same, says the aforementioned article, it could last the entire fourth quarter of this year.
Ethereum inside the circle
When it comes to the second most important cryptocurrency in market capitalization, Ethereum, there is a similar situation. The options open in this digital currency, reach about 160 thousand, which represents a face value of about $ 76 million US dollars.
Ethereum options, like Bitcoin options, expire on October 30. At the time of writing, the value of ETH is $ 389. In the same way as Bitcoin, this currency has also had a behavior similar to that of traditional markets in the face of the imminent US elections.
Although this cryptocurrency, for obvious reasons, has less impact than Bitcoin, its importance should not be underestimated. Another outstanding fact is the maturity of these digital assets, which are less and less prey to volatility.
For example, Bitcoin, has been praised by major investors and analysts such as Mike novogratz founder and CEO of Galaxy. For him, the main cryptocurrency it is less like stocks and more like gold. In other words, its maturity makes the behavior of Bitcoin move away from volatility and resemble that of a store of value.
Nothing is likely to happen
Despite the alarms that analysts have set off, regarding the volatility of the price of Bitcoin, compared to the expiration of the aforementioned options, it is likely that these will go unnoticed for their price. This could be a possibility, if recent experiences are taken into account.
For example, on September 25, some 87 thousand Bitcoin options expired. According to many analysts, this fact would bring a significant increase in volatility. But the reality was different and the price of Bitcoin has remained at a good pace since then.
On that day, the price of Bitcoin woke up to $ 10,248 and in the afternoon, after the expiration of the options, it had risen to $ 10,771. This is likely a confirmation of Novogratz’s words, and Bitcoin’s role as a store of value has already been strongly imposed.
The flip side of the effect of the United States elections, and its impact on Bitcoin, is that if this digital currency is really being assimilated by investors as a store of value, then, it would be favored by the volatility of traditional markets.
Data to take into consideration
- Some 60,000 Bitcoin options will expire on October 30, they have a face value of $ 750 million USD.
- Of those 60K options, about 40K are hosted on the exchange platform Deribit.
- At the end of the week, he assures Skrew.com, the price of Bitcoin and Ethereum could enter a stage of volatility.
- The next presidential elections in the United States become another factor that increases commercial uncertainty.
- As for Ethereum, on the same October 30, some 160 thousand options expire, which have a face value of $ 76 million USD.