Crypto derivatives markets are approaching a significant year-end inflection point, with a large share of bitcoin and ether options on Deribit set to expire in a single session.
The so-called Boxing Day expiry will see roughly $23.6 billion in bitcoin options and $3.8 billion in ether options come off the books. Each contract represents one BTC or one ETH, and the settlement accounts for more than half of Deribit’s total open interest.
Despite recent price volatility, positioning into the expiry remains tilted to the upside. Deribit data show a put-call ratio of 0.38, reflecting a heavy preference for call options and an overall bullish skew.
“The max pain level is around $96,000, and the low put-call ratio highlights how positioning is biased toward calls,” said Sidrah Fariq, Deribit’s global head of retail sales and business development, in comments shared on Telegram. The max pain price refers to the level at which options buyers collectively lose the most, while sellers — typically institutional traders and market makers — stand to gain.
Options contracts give traders the right, but not the obligation, to buy or sell an asset at a predetermined price on a future date. Calls express bullish sentiment, while puts are commonly used for downside protection or bearish positioning.
Max pain draws attention
As expiry approaches, the max pain level has become a focal point for traders. Some argue that hedging activity by professional participants can exert a pull on spot prices, potentially guiding bitcoin toward $96,000 and ether toward $3,100 by settlement.
Even so, the max pain concept remains controversial, with many market participants questioning its practical impact on price behavior.
Bullish skew meets holiday slowdown
The put-call ratio implies there are only 38 puts for every 100 calls outstanding, underscoring the extent to which traders have pursued upside exposure this year. Open interest is concentrated in calls with strikes between $100,000 and $116,000, while the $85,000 put remains the most heavily traded downside hedge.
Large expiries often bring heightened activity as traders close or roll positions into later maturities. Fariq noted that some puts in the $70,000 to $85,000 range are being rolled into January expiries.
“Whether traders allow December puts to expire or extend them will help determine whether downside risk reflects year-end positioning or a broader structural reset,” she said.
Despite the scale of the expiry, expectations for turbulence remain restrained. “The settlement falls on Boxing Day, liquidity is thinner due to the holidays, and while upside exposure dominates, macro uncertainty continues to limit strong directional conviction,” Fariq added.
Deribit’s bitcoin DVOL index — a gauge of 30-day implied volatility — is currently near 45%, down from 63% in late November when bitcoin briefly slid toward $80,000. The decline suggests waning market anxiety and a reduced likelihood of outsized volatility tied to the expiry.
