June 25 marks an important day for the Ethereum network as the second-largest cryptocurrency will face its largest options expiry where an open interest of around $1.5 billion will be settled. This figure is 30% larger than the previous March 26th expiry which took the price of Ether to drop by 17% in just 5 days at $1,550.
Ethereum Settling Open Interest of $1.5B On June 25
With Ethereum settling the largest open interest of around $1.5 billion, investors are anticipating what this marks for the second-largest cryptocurrency by market cap.
The earlier options expiry took place on the 26th of March that took the price of Ether plunging by around 17% in around 5 days with the cryptocurrency dropping at $1,550.
Following the March expiry, Ethereum’s price did rally up to 56% where it reached $2,500 in just three weeks.
The moves were completely uncorrelated with the price movement of Bitcoin, this makes it extremely important if the same market structure might be in play on the 25th of June futures and options expiry.
Meanwhile, there is quite a disproportionate amount of call options set at $2,200 and multiple higher strikes, indicating that if the price of Ethereum on 25th June goes below this level, around 73% of the neutral to bullish options will be worthless.
Hence, the remaining 73,700 put options would represent a $177 million open interest while the 95,000 call options in play would represent a $228 million open interest.
June Options Enquiry Could be Either Bearish or Bullish
Unlike futures contracts, options are divided into two segments such as call (buy) options and put (sell) options.
Call (buy) allows buyers to acquire Ether at a fixed price on the expiry date used mostly on neutral arbitrage trades or bullish strategies while the put (sell) options are commonly used to hedge or protect from volatile price swings.
It still seems unclear as to whether the much-anticipated options enquiry will be bullish or bearish for the coming times, but considering Ether’s current price of $2,509, anything is possible.