Author: Marcel Pechman

Translation: Deep Tide TechFlow

Deep Tide Guide: This Friday is the expiration date for March Bitcoin monthly options, totaling $18.6 billion.

92% of call options may expire worthless below $71,000, while signals of economic cracks in the U.S. private credit market, such as redemption restrictions, are providing ammunition for bears.

Bulls need a 6% rebound to turn the situation around, with only two days left.

The full text is as follows:

Bitcoin's price has been compressed over the past week within a narrow range of $67,700 to $71,600, closely reflecting the U.S. stock market's response to the U.S.-Iran war. Traders are hopeful that the $18.6 billion Bitcoin monthly options expiring this Friday will provide the bullish momentum needed to break through $75,000.

Figure: S&P 500 Futures (left) compared to Bitcoin/USD (right)

Source: TradingView

In March, call options for Bitcoin dominated the total open interest, amounting to $11.2 billion, while put options were low by 34%, at $7.4 billion. However, this advantage is not significant—Bitcoin has failed to stay above $74,000 for the past seven weeks. WTI oil prices have consistently held above $90, raising investor concerns about persistent inflationary pressures.

Economic Uncertainty Favors Bears in Quarterly Options Expiration

Preliminary signals of cracks in the U.S. economy have emerged: private credit funds are limiting redemptions due to concerns over worsening loan quality. According to CNBC, this $30 trillion industry has recently come under scrutiny, with asset management firms Ares Management, Apollo Global Management, Blue Owl Capital, and Cliffwater being forced to pause or restrict withdrawals.

This socioeconomic uncertainty may be precisely what bears need in the Bitcoin quarterly expiration. Analysts are assessing the forces that could drive Bitcoin prices in the hours leading up to the expiration at 8:00 UTC this Friday through the strike prices of call and put options.

Deribit is leading with a 76% market share, with open interest at $14.1 billion; OKX follows with 7.1%, and CME ranks third with 6.6%. Despite higher demand for call options, the Bitcoin bulls on Deribit are overly aggressive, with most bets concentrated at $90,000 and above.

Figure: Deribit March 27 Bitcoin Call Options (in USD) Open Interest

Source: Deribit

On Deribit, only $2 billion of call options are positioned below $78,000, meaning 77% of call options may expire worthless this Friday. If the price expires at $71,000, 92% of call option positions will be entirely void—bulls clearly did not anticipate this outcome.

Some of these positions may have been established when Bitcoin was still trading above $86,000 in February of this year, which explains why so much open interest is concentrated far above the current price.

Figure: Deribit March 27 Bitcoin Put Options (in USD) Open Interest

Source: Deribit

Put options with a strike price of $66,000 or higher on Deribit have an open interest of $2.2 billion, meaning 40% of put options will still have value at expiration this Friday. Therefore, put options hold a slight initial advantage, but more granular analysis is needed to understand the impact of price movements on the outcome.

Here are four possible outcomes for Deribit BTC options expiration this Friday based on current price trends:

• Between $65,000 and $69,000: Put (sell) options net dominant $1.8 billion
• Between $69,001 and $72,000: Put (sell) options net dominant $950 million
• Between $72,001 and $75,000: Put (sell) options net dominant $430 million
• Between $75,001 and $78,000: Call (buy) options net dominant $790 million

In summary: Bitcoin bulls need the price to rise 6% from the current level of $70,900 to turn the outcome of the March options expiration around.