According to Deribit's DVOL index, ETH's Implied Volatility Hits Lowest Level ever.
Some traders are keeping their eye on their clocks as roughly 26% of open positions on Deribit, the leading exchange for crypto options, are set to expire on Friday at 8am UTC.
Luuk Strijers, the chief commercial officer of Deribit, said Tuesday that roughly 85,000 open BTC contracts for $2.3B and 700,000 ETH contracts worth $1.3B will expire today.
Strijers said twice as many ETH traders are long the asset compared to those who are short, with Ether's'max pain' level currently sitting at $1,800, meaning a closing price of $1,800 would result in the largest number of options expiring worthless.
As many BTC traders are long versus short, Bitcoin's max pain point, $27,000, is about two and a half times as long.
With ETH currently trading at $1,805 and BTC currently trading at $26,450, it appears many traders may still suffer substantial losses.
Traders can buy or sell an asset at a fixed price until the expiry date of a fixed expiry date through options, which are financial derivatives. The option premium is only a possibility that Traders may encounter, enabling leveraged bets with limited capital. options raise the potential for both risk and reward, allowing options traders to quickly rack up sizable losses if they are not careful.
Strijers said that the volatility of both markets is at 'rock-bottom'. A major bullish move is likely to be seen in the coming months due to similar market conditions.
Strijers said he had no idea what had happened at the moment of the meeting.