Bitcoin options worth $23.7B expire soon – Why traders expect fireworks

ambcryptoPublished on 2025-12-25Last updated on 2025-12-25

Abstract

Bitcoin has been trading between $85k and $92k in December, but a record $23.7 billion options expiry on December 26th is expected to cause significant price movement. Analysts anticipate a potential 5%-7% swing, with a Max Pain Point at $95,000. Many predict a short-term dip to the $82k-$84k support level, followed by a rally toward $95k or even $100k. However, QCP Capital cautions that this holiday-driven volatility may not be sustainable and could mean-revert as liquidity returns in January.

Bitcoin has traded between the $85k-$92k range throughout December. The options expiry on Friday, the 26th of December, will likely shake things up.

QCP Capital noted in their latest US Colour market update that liquidity was thinning as traders closed out their positions ahead of the holidays.

This caused a drop in Open Interest for Bitcoin and Ethereum [ETH]. A 5%-7% price swing towards the end of the year is expected due to the options expiries towards the year-end.

Friday’s record expiry measured $23.7 billion, with roughly 300k BTC options contracts and 446k IBIT option contracts.

The Max Pain Point was at $95,000, with a sizeable concentration of strikes at $100k and $85k as well. How will this affect the Bitcoin [BTC] price action?

Analysts agree that Bitcoin is likely to bounce soon

In a post on X, Founder and CEO of Alphractal Joao Wedson highlighted the points of interest around Bitcoin right now. The Put/Call ratio is just 0.38, and the Max Pain Point created a strong short-term price gravity that would pull the price to $95k.

In another post, Wedson used the liquidation levels to highlight his expectations.

The leveraged positions around $84k and $95k were clear on the heatmap and were the short-term price targets. BTC would likely dip toward $82k-$84k before rallying to $95k and possibly higher.

Another user, David, highlighted similar expectations. The analyst observed that the $90k level was a false ceiling, and the $100k level was a structural magnet. Of particular interest were the levels mentioned for the initial flush, at $80k-$82k.

A move to $90k would be the breakout trigger.

QCP Capital noted that this rally might not be sustainable.

“...holiday-driven moves have historically tended to mean-revert. Much like low-liquidity weekend spikes that often retrace once markets reopen, Christmas week price action typically fades as liquidity returns in January.”

The holiday price action might be extra volatile as thin books encounter tax-loss harvesting from crypto investors ahead of the 31st of December deadline. These conditions can amplify short-term volatility instead of suppressing it.

Final Thoughts

  • The options expiry on Friday is the largest of the year (quarterly + annual), equivalent to $23.7 billion.
  • Analysts suggest that a BTC dip to $82k-$84k could be followed by a rally toward the max pain point at $95k upon options expiry.

Related Questions

QWhat is the total value of the Bitcoin options expiring on December 26th, and why is this event significant?

AThe total value of the Bitcoin options expiring on December 26th is $23.7 billion. This event is significant because it is the largest options expiry of the year (a combined quarterly and annual expiry) and is expected to cause a significant price swing, potentially 5%-7%, due to the massive amount of contracts involved and the thinning market liquidity.

QAccording to analysts, what are the key short-term price levels for Bitcoin to watch around this expiry event?

AAnalysts highlight several key short-term price levels. The Max Pain Point is at $95,000, which creates a strong price gravity. A dip towards the $82k-$84k range is seen as a potential buying opportunity before a rally toward $95k. The $100k level is also noted as a structural magnet, while $90k is identified as a breakout trigger.

QWhat is the low Put/Call ratio of 0.38 mentioned in the article, and what does it typically indicate about market sentiment?

AA Put/Call ratio of 0.38 indicates that there are significantly more call options (betting on the price going up) than put options (betting on the price going down) in the market. This typically reflects a strong bullish sentiment among traders, as they are positioning for a potential price increase.

QWhy does QCP Capital suggest that a potential price rally might not be sustainable?

AQCP Capital suggests the rally might not be sustainable because it is driven by holiday-thinned liquidity. They compare it to low-liquidity weekend price spikes that often retrace, stating that Christmas week price action typically fades as normal liquidity returns to the markets in January.

QWhat additional factor could amplify short-term volatility around the year-end, according to the article?

ATax-loss harvesting from crypto investors ahead of the December 31st deadline could amplify short-term volatility. This activity, combined with already thin order books, can lead to larger and more abrupt price movements instead of suppressing them.

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