The price of Bitcoin and quite a few other cryptocurrencies in the market have tanked over the last day. The two largest cryptocurrencies in the world have gone down by 7.6% and 8% respectively. There is a huge possibility that the price drop is related to the options expiry at around $3.8 billion. Most experts stand on the border as to whether it was effective or not.
Bitcoin Has Crashed Leading Traders To Inquire About Options Expiry
Bitcoin options have always been derived contracts that provide the buyers with this fundamental right to purchase the assets at a certain price someway down the line. When most of the options are about to expire, the market of cryptocurrency can get volatile. This is certainly because most of the traders would either be dumping or holding the crypto buys that are quite potent. According to news, the last Friday in May saw an entire load of options expiring which resulted in the market crashing quite comprehensively.
As of today, Bitcoin represents a sum total of $2.6 billion, whereas Ethereum has a total value of $1.2 billion in options. This is quite a record as far as options contracts go- coupled with the amount of options contracts expiring over the course of a single day for Ethereum. Incidentally, both assets have also been struggling heavily which has led traders to look towards selling the stocks.
Ki Young Ju, the CEO of CryptoQuant, has stated that it is quite plausible that this is the largest options expiry for the second-largest cryptocurrency in the world. He also believes that there have been multiple pieces of evidence suggesting the presence of a bearish market as most of the supply of Ethereum has been increasing steadily.
But, this has not stopped the markets from going through a hard time. Bitcoin fell under $30,000 on Tuesday for the first time since January. The value of Ethereum also went below $2,000.
