Bitcoin Price Still Hanging On Friday’s $2.26B BTC Options

Bitcoin bears are now taking advantage of the existing macroeconomic uncertainty and eyeing the $270 million profit in case the value of this top cryptocurrency goes beyond the $25,000 mark.

The price of this cryptocurrency wasn’t able to go above the $27,500 mark for the fourth time in 12 days. Additionally, it was trading at the lower point of 68 days where it closed at $26,100.

Furthermore, the deadline for the Bitcoin monthly options is just around the corner. The future of the $2.26 billion open interest could decide whether the current bear run would continue, making it possible for the coin to see a correction down to the $25,000 mark or even lower that.

U.S. Debt Ceiling and the Bitcoin Price

Analysts contend that risky investments like stocks and cryptocurrencies could see a significant impact even if the U.S. government is successful in raising the debt ceiling before the June 1 deadline since the introduction of new U.S. Treasury securities would reduce market liquidity.

The fixed income incentives are in position with the one-year instruments return of a 5.15% yield and the chances of a possible economic crisis increase. No matter how the U.S. plans to handle its debt issues, investors will look for safe-haven assets in times of uncertainty.

For example, an article from Reuters shows that in the U.S. the fund assets in the money market hit the $5.8 trillion mark this week which is a new record. The primary reason for this is that investors are now eyeing short-term debt securities.

Fixed-income mutual funds, which are a major source of capital for corporations and governmental entities, have seen net inflows of $615 billion until now in 2023.

The 11% increase in Bitcoin’s cumulative losses since May 6 can just be the thing that bears require to take advantage of May’s $2.26 billion monthly options expiry.

Bulls Placing More Than 80% Bets Above $29,000

The May 26 options expiry had an open interest of around $2.26 billion. However, the real figure can be greater than that as bulls were expecting the value of Bitcoin to be above $29,000. These traders were surprised when the price of Bitcoin saw a decline of around 11% between 6th May and 12th May.

Furthermore, the put-to-call ratio of .03 shows that there is an imbalance between the call (buy) open interest and input (sell) options where the former is $1.64 billion while the latter is $630 million.

But, if the value of the top-notch currency would remain close to $26,500 from May 26th till 8 AM (UTC), the call options that would be available would only be around $67 million.

The difference between both is due to the right to buy the cryptocurrency at $27,000 or $28,000 is futile if the Bitcoin is trading beyond that mark upon expiry.

Bears Could Leverage the Profits to More Pressure on Bitcoin’s Price

Bitcoin bulls will be more than happy if they get nothing out of the move to push Bitcoin beyond the price level of $27,000 during the expiry. On the other hand, the bears would only need to get a drop of 2% from $26,300.

Once that happens, the bears would likely be able to get a profit of $180 million. Considering the recent Bull Run for risk-on assets due to the issues with the U.S. debt ceiling matter, Bitcoin bears are in a much more comfortable position for the expiry of May $2.26 billion BTC monthly options.

To summarize it all, an expiry below the price range of $26,000 will give a boost to bears’ appetite. As a result, they will try to put more pressure on Bitcoin’s price to let it go down to $25,000.