If you’re considering stepping away from trading screens this weekend, you might want to reconsider. Insights from digital asset trading firm STS Digital indicate that the White House crypto summit on Friday is likely to spur increased trading activity.
President Donald Trump, who has pledged to establish a strategic crypto reserve ahead of the November election, will welcome leading figures from the industry, including representatives from Coinbase, Chainlink, and Exodus.
Recent speculation points to the possibility that Trump could unveil plans for a strategic bitcoin (BTC) reserve during the summit, moving away from earlier hints about a portfolio of altcoins such as XRP, Cardano’s ADA, and Solana (SOL), alongside BTC and ether (ETH).
The pricing of options for BTC, ETH, and SOL on Deribit indicates that traders anticipate a turbulent weekend following the summit.
“Options markets are reflecting elevated anxiety (and lack of liquidity) as we approach the weekend filled with uncertainties. The implied volatility spread between Friday and Saturday is nearly 25 vols wide across the board, with Friday expirations failing to meet expectations,” stated Jeff Anderson, head of Asia at STS Digital, in an interview with CoinDesk.
Implied volatility, derived from options pricing, reflects market expectations about how much an asset’s price will fluctuate over a certain timeframe. Options are contracts granting buyers the right to buy or sell the underlying asset at a set price on a future date.
Early Thursday, bitcoin options expiring Friday indicated an annualized implied volatility of 56%, while those set to expire on Saturday indicated volatility of 80%. This 24-point disparity suggests a forecast of increased price fluctuations after Friday’s summit.
A similar trend was observed in options for ether and solana.
The accompanying chart illustrates the implied and forward volatilities for BTC, ETH, and SOL, along with straddle breakevens (projected price fluctuations).
Forward volatility is determined by comparing the implied volatility of options with various maturity dates and signifies the anticipated volatility between the two set expiration dates, in this case, Friday and Saturday.
The 105% forward volatility for BTC indicates an expected price movement of 5.5% between Friday at 08:00 UTC and Saturday at 08:00 UTC, as Deribit options expire at 08:00 UTC.
In simpler terms, BTC could potentially experience swings of nearly $5K in either direction after the summit. Meanwhile, ETH and SOL volatilities forecast moves of $135 and $13, respectively.
According to Anderson, high expectations for volatility can frequently lead to disappointment.
“Large anticipated volatility often results in disillusionment in crypto markets where expectations tend to exceed reality. Nonetheless, the breakevens do not seem excessive, and options remain the safest approach for directional views in this climate,” Anderson remarked, highlighting the risks associated with making directional bets on options expiring on March 14.
“Following the event, we expect option prices for longer tenors to decrease as concerns diminish and volatility subsides,” Anderson added.
