Event Overview

Recently, Bitcoin is approaching the largest options expiration window in history. According to various data sources, the nominal value of this expiration is estimated to be between $23.4 billion and $23.6 billion, far exceeding any previous single-day settlement scale, making it one of the key turning points of the current cycle. The market generally identifies the maximum pain point around $95,000, with some data sources refining the range to $95,000-$96,000, indicating that the theoretical optimal settlement range for a large number of options sellers coincides with the current high-volume trading zone. Based on the options position structure, bullish contracts clearly dominate, with a call/put ratio around 0.36-0.38, showing that bulls prefer to seek tail-end profits through high-execution-price call options rather than directly leveraging to buy spot or perpetual contracts. This event coincides with the year-end settlement period and holiday trading sessions, compounded by the recent sale of approximately 2,300 BTC by hackers related to the Mentougou incident, as well as the routine settlement actions of institutions and miners. In an already thin liquidity environment, concentrated trading in any direction could amplify short-term volatility, making it easier for prices to experience "spike" movements beyond the usual range.

News and Chips

There are significant discrepancies in the market regarding the scale of this options expiration and the maximum pain point: some viewpoints provide a conservative estimate of about $23 billion, while others point to higher ranges of $23.4 billion or $23.6 billion. If assets like Ethereum are included, the overall nominal value approaches $27 billion. From the disclosures of professional derivatives trading platforms and data providers, a more prudent approach is to consider "$23.4-$23.6 billion" as a working range, rather than over-processing a single number to avoid misjudgments due to differences in statistical caliber and contract settlement ranges. In terms of open interest distribution, the current largest "intersection point" of interests is concentrated in the $95,000-$96,000 range: this area often corresponds to the maximum pain point, meaning that if the price settles near this area at expiration, options sellers can maximize time value decay and compress the actual exercise profits for both call and put buyers. For large fund sellers, guiding the underlying price toward this area helps lock in the premiums previously collected, creating a sort of "magnetic effect" for price convergence. Meanwhile, hackers related to Mentougou have recently been monitored to have sold approximately 2,300 BTC, and combined with the year-end traditional settlements and rebalancing actions of institutions, miners, and funds, this has added clear selling pressure variables on the spot side. Whether sufficient buying support can be maintained above $90,000 to $95,000 depends not only on the inflow pace of off-exchange funds and institutions like ETFs but also on the passive buying and selling forces brought about by options hedging. These factors collectively shape the chip structure and potential volatility framework for this expiration.

Funds and Sentiment

From the perspective of options structure, bullish sentiment before this expiration had temporarily dominated, with a large number of call options concentrated at higher execution prices, with some KOLs even describing it as "one of the largest bullish bets in history." However, the event occurs during a holiday trading period, where liquidity is naturally thin, and institutions and large funds can more easily leverage their positions and information advantages to create amplified volatility near key price levels. Several derivatives traders have warned that in the current environment, there is a possibility of experiencing daily fluctuations of $2,000 or even larger ranges. Public opinion and community sentiment exhibit a typical state of FOMO and panic coexisting: on one hand, views represented by figures like @华尔小猫 suggest that once the spot price effectively breaks through the $90,000 mark, the options Gamma effect could quickly amplify, with the upward range possibly targeting $96,000 or even $100,000, triggering a short squeeze and passive covering; on the other hand, there are concerns about "holiday sell-offs" and price manipulation, especially during repeated fluctuations near the maximum pain point, where investors are prone to interpret any sharp volatility as "organized harvesting." Meanwhile, the fear and greed index has temporarily fallen to relatively low levels, and on-chain realized loss indicators are approaching the highs seen after the FTX collapse, along with cases of significant unrealized losses in some large leveraged accounts spreading on social media, making the current environment resemble a high-risk zone characterized by "paper losses + emotional tearing." If the direction chosen contradicts market expectations, the potential chain liquidation effect cannot be ignored.

Bull-Bear Game

In terms of the options long-short structure, this expiration exhibits a typical layered characteristic: call options are concentrated in the far month and at higher execution prices, primarily serving bullish funds betting on trend continuation and potential new highs; put options are more focused on the near month and lower protective ranges, providing downside hedging for spot holders or high-leverage accounts. As expiration approaches, short-term pricing and price dominance are likely to be more in the hands of options sellers and professional traders focused on Gamma and Delta hedging, rather than purely directional long-short games. The bullish side hopes to stabilize the price at $90,000 or even break through further, triggering a repricing of far-month and high-execution-price call options, pushing implied volatility and premium levels higher, thereby allowing previously established bullish positions to gain expansion profits; the bearish side similarly hopes for the price to retreat and stabilize around $95,000, allowing a large number of out-of-the-money calls and puts to expire worthless as time value decays, thus constructing a profit balance pattern near the maximum pain point where "no one earns too much, and sellers eat the premiums." In terms of path, the market is oscillating between two forces: one is an effective breakthrough above $90,000, triggering Gamma squeeze, forcing market makers and sellers to continuously buy spot to hedge, forming a short-term upward path toward $96,000-$100,000; the other is the price being repeatedly suppressed near the maximum pain point, consolidating through reverse hedging and subjective sell-offs, firmly locking the underlying in a range favorable for sellers' settlements, thus digesting this round of volatility more in the natural decay of time value.

Macro and Narrative

Zooming out from a single expiration event, the current macro environment and long-term narrative also show significant divergence. Some macro analysts have begun to view Bitcoin as a high-beta tech asset, suggesting that against the backdrop of potential deflation or efficiency revolutions driven by AI and robotics, Bitcoin's performance is more akin to a basket of high-growth tech stocks rather than a traditional safe-haven asset; under this narrative, unless the world reopens a high-intensity monetary easing and large-scale printing cycle, Bitcoin's price will face dual challenges of valuation compression and tightening liquidity. In contrast, another viewpoint still emphasizes the attributes of "digital gold" and long-term store of value, believing that Bitcoin and stablecoins are positively correlated, and that macro liquidity easing and the expansion of compliant channels (such as ETFs) will continue to bring incremental buying in the medium to long term. From a cyclical perspective, the period around Christmas has historically often marked bear market bottoms or key turning points—around $319 in 2014, approximately $3,815 in 2018, and about $16,831 in 2022 all occurred around this time; currently, we are in the mid to late stage driven by halving and ETF funds, with volatility rising while direction is more constrained by macro liquidity, regulatory progress, and institutional allocation rhythms. On a deeper technical and compliance level, the increase in Ethereum's gas limit from 60 million to 80 million, the potential development of Bitcoin's UTXO model (such as new protocols and layer-two expansions), and the progress of some public chains and service providers in licensing and compliance are marginally improving the risk premium structure of the entire crypto asset, providing infrastructure support for capital inflow and risk repricing after high volatility phases.

Path and Strategy

In such a derivatives and macro environment, the price evolution of Bitcoin over the next period can be roughly divided into three main paths. The first is a high-level consolidation near $95,000, completing the full digestion of options time value through multiple tests of the upper and lower ranges, allowing this historically largest expiration to conclude in a manner of "high-level oscillation + premiums going to zero." The second is an upward breakthrough driven by bullish momentum and Gamma hedging around the expiration, especially after effectively stabilizing above $90,000, further attacking the $96,000 to $100,000 range, forming a typical short-term squeeze and liquidation market. The third is that selling pressure and liquidity gaps dominate, with the combined effects of Mentougou sell-offs, year-end settlements, and sentiment reversals causing the price to retreat from high levels, retesting lower, more solid support ranges. It is important to emphasize that these three paths are all conditional scenario extrapolations based on current information, rather than deterministic predictions, and should be continuously adjusted as data and market conditions change. For actual trading and risk control, a more actionable framework is:
• Focus closely on the gains and losses and volume changes around key price levels of $90,000, $95,000, and $96,000-$100,000, combined with the steepness and structural changes of implied volatility (IV) before and after the event, to determine whether it is a "directional choice" or "pure volatility contraction";
• Be especially cautious of slippage and instantaneous spikes caused by liquidity vacuums during holiday periods, avoiding placing large stop-loss or chase orders at extreme price levels, strictly controlling leverage levels and unilateral naked risks, and reducing the possibility of amplified losses due to passive liquidations;
• After the options expiration, closely observe the direction of new options position rebuilding, the basis repair situation of spot and perpetual contracts, and the net inflow/outflow data of ETFs and institutional funds, to determine whether this round of volatility is a typical "year-end settlement and clearing market" or a preheating stage before a new trend starts. For most investors, in this high-volatility window, establishing a discipline centered on position management, risk diversification, and data tracking is more meaningful in the long term than attempting to precisely capture a single directional "profit opportunity."

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