Data shows that when BTC options expire worth 2.5B

Bitcoin’s price (BTC) has dropped about 22 percent in the previous 7 days, analyzing the $31,700 area for the second time in June. According to some analysts, the most pressing news for the adverse growth is that China is said to have dismissed the bank account of the over-the-counter switches:

China deciphered the bank accounts of #bitcoin OTC desk, it’s getting serious!

– Lark Davis (@TheCryptoLark) June 21, 2021

However, as Cointelegraph reports, a fall in Bitcoin’s hash rate by almost 50 percent to an 8-month low may also play a major role in the price correction. Even MicroStrategy’s current $489 million purchase was inadequate to sustain the $35,000 support.

The development increased the feeling that options and futures contracts, which expire on June 25, could also be behind it. After this month will probably pay for $ 2.5 billion worth of options and another $ 2 billion in futures contracts.

Currently, CME stocks make up nearly half of all open futures contracts, although historically many investors reversed their positions in the last week of trading.

Market manufacturers and arbitrageurs tend to take short futures positions while holding BTC, benefiting from the normal spot foreign exchange markets. Large asset managers like Tudor Investments are now taking long futures dangers.

However, there is no advantage in exercising an options contract that is already useless ) With less than five days to expire, the right to purchase Bitcoin (Call) for $44,000 is trading at $20.

The initial picture speaks for the bulls as neutral to bullish call (purchase ) options contracts are currently 36 percent more existing in the June 25th expiration.

Related: Ethereum’s $ 1.5 billion expiration of options on June 25 is going to be a fantastic time

Note that 87 percent of the telephone (call option) was put over $34,000. Therefore, if Bitcoin remains below this amount, only $200 million in open interest from such neutral to bullish contracts will expire in June.

Meanwhile, 46 percent of security calls over $34,000 were opened. This equates to an open interest of $510 million, which provides these neutral contracts a substantial edge over bearish contracts.

The $310 million spread in favor of the bears would be decreased by $190 million if Bitcoin trades over $36,000 on June 25. The possible $450 million benefit is substantial and should not be ignored.

It can make sense for the bulls to throw in the towel, lick their wounds and open new positions beforehand with put orders throughout the spread to be able to enable profit in addition to profit without prepayment.

The views and opinions expressed here are solely those of author and don’t necessarily reflect the views of Cointelegraph. Every investment and trading movement entails risks. You should do your own research when making a choice.