Ethereum bulls control 100% of the expiration of the $ 470 million ETH options this week


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A total of $ 470 million in Ether Options (ETH) will expire on May 7, and “slaughter” is really the only word that describes what will happen to bearish ETH traders.

Currently, almost every single one of the 75,909 put (sell) option contracts will become worthless if Ether stays above $ 3,100 by Friday, 8:00 a.m. UTC.

Ether’s growth has been driven by the growth of its decentralized financing (DeFi), which recently exceeded a total of over $ 60 billion, according to DeBank. Yat Siu, chairman and co-founder of Animoca Brands, described the scene perfectly:

“DeFi will shape finance in incredibly fundamental ways. Perhaps the greatest path (in China too) is through financial literacy.”

Siu added:

“Imagine a world where financial inclusion is not just about having a bank account, it’s also about being able to easily and effectively participate in a variety of capital opportunities.”

While this may have sounded futuristic a year ago, the Ethereum network has opened the doors to these markets in no time.

In relation to the options expiration on May 7th, the neutral to bearish puts currently have an open interest of $ 250 million but tend to become worthless as the settlement day progresses.

Ether May 7th aggregated options expire on strike. Source: Bybt

While the apparent put-to-call ratio favors the more bearish ether put options by 13%, when analyzing the target price (strike) for these derivatives there is no activity above $ 3,100. Ether’s 55% rally over the past 30 days surprised the bears as protections focused mostly on $ 2,800 and less.

Bulls, on the other hand, tend to be very optimistic. The call option contracts are open at 66,350, which corresponds to USD 220 million. Currently, 13.5% of these neutral to bullish options contracts have strikes of $ 3,200 and above.

Given that the call options completely dominate above $ 2,700, bulls have incentives to push the price positively as the May 7th deadline approaches. In contrast to futures markets, the rollover of contracts offers only a few advantages that are now almost worthless.

Ether put option pricing for May 7th. Source: Deribit

As shown above, ETH’s put options are offered at $ 2,450 and lower strike under $ 10 each. Meanwhile, some of them have no commandments at all. Hence, it makes sense for Ether Bears to throw in the towel for this week’s expiry rather than wasting resources saving the badly cast bets.

For those questioning Ether’s current valuation, Cointelegraph recently revealed that the cryptocurrency can be less risky than holding traditional dividend-paying stocks like Roche or Procter & Gamble.

Additionally, Ethereum’s spectacular growth in decentralized applications and daily network transfers and transactions is likely to push the Ether bulls to set even higher goals for the end of the month.

The views and opinions expressed here are solely those of author and do not necessarily reflect the views of Cointelegraph. Every investment and trading step is associated with risks. You should do your own research when making a decision.