Bitcoin, $9.8 Billion Option Expiry...Historic Bloodbath Warning

▲ Bitcoin (BTC)

Bitcoin (BTC) has entered a vacuum state, exposed defenselessly to increased volatility, as the support base of market makers that sustained the market disappeared after an unprecedented scale of option expiry.

According to crypto media outlet U.Today on April 24 (local time), approximately $9.8 billion worth of Bitcoin option contracts expired on the Deribit exchange, concluding the month's biggest event. At the time of expiry, 8 AM UTC, Bitcoin was trading around $77,900, which is about $6,000 higher than the maximum pain point of $72,000. This expiry was a rare case where call option buyers realized significant profits and led the market.

However, this success paradoxically created a liquidity trap. Immediately after the option obligations were resolved, the market showed typical inertial behavior. Bitcoin briefly rose by 0.53%, touching the $78,000 mark, but then immediately fell by 0.66%, showing a helpless inability to maintain the psychological resistance level. This indicates a lack of additional momentum to drive prices higher.

Currently, the biggest threat is not a decrease in demand but a rapid change in market structure. Before the option expiry, market makers defended price volatility through dynamic hedging and supported positions, but with the expiry of approximately $8.47 billion worth of Bitcoin options, that support base has completely disappeared. As the buffer zone protecting the market evaporated, Bitcoin has effectively entered a vacuum state, vulnerable to external shocks.

Similar to XRP, Bitcoin has entered a phase free from option pressure, but the risk factors remain due to the lack of protective mechanisms. In a situation where market makers' defenses have been removed, even small market orders can create an environment where prices can abnormally surge or plummet. Investors are warning that the current price level, contrary to appearances, harbors deceptive vulnerability.

After the massive volume in the options market was resolved, Bitcoin is entering a new price discovery phase. The void left by the withdrawal of market makers' hedging positions is expected to be filled by direct clashes between real buying and selling pressure. As the institutional mechanisms that controlled market volatility have disappeared, sensitivity to macroeconomic indicators and large-scale supply and demand changes is expected to be extremely high for the time being.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*