Bitcoin (BTC) remained trapped near $87,000 on December 24 ahead of a record-breaking options expiry event that could determine short-term price direction.
Roughly $23.6 billion worth of Bitcoin options contracts expire Friday on Deribit, representing over 50% of the exchange's total open interest.
The expiry includes approximately 300,000 Bitcoin options contracts alongside 446,000 BlackRock iShares Bitcoin Trust options.
An additional $3.8 billion in Ethereum options expire simultaneously, bringing total cryptocurrency options settlement to $27.4 billion.
What Happened
Trading firm QCP Capital noted that Bitcoin has experienced 5-7% price swings during past Christmas periods, often linked to year-end options settlements rather than fundamental catalysts.
The current expiry represents the largest such event in cryptocurrency market history.
Deribit data shows the "max pain" price level sits at $96,000, where the maximum number of options contracts expire worthless.
The put-call ratio of 0.38 reflects positioning skewed heavily toward calls, indicating traders remain bullish on Bitcoin's medium-term prospects.
QCP analysts highlighted that approximately $1.2 billion in open interest clusters at the $85,000 put strike price.
Market observers have described the large December expiry as acting like a "lid" on Bitcoin's price action throughout the month.
Crypto derivatives analyst David Eng previously stated the options positioning creates artificial price suppression that should lift after settlement.
Eng predicted an initial post-expiry target of $100,000 once the structural pressure dissipates.
Bitcoin has traded in a tight $85,000-$90,000 range for multiple weeks.
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Why It Matters
The massive expiry coincides with thinned holiday liquidity, potentially amplifying post-settlement moves.
Market makers hedge options positions by buying or selling Bitcoin, creating mechanical price pressure that pins prices near key strikes until contracts expire.
Traders are watching whether large December $85,000 put positions get rolled forward into January or closed out after settlement.
The outcome could signal whether bearish positioning softens or intensifies heading into 2026.
Meanwhile, gold reached all-time highs above $4,449 per ounce this week while Bitcoin remained rangebound.
Some analysts predict capital rotation from precious metals into cryptocurrency once Bitcoin breaks resistance.
Bitcoin's implied volatility declined to 45% from 63% in November, suggesting traders expect manageable swings despite the record settlement.
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