Friday's $28.5 billion options expiration! Bitcoin faces Deribit super settlement day test

Cryptocurrency markets experienced intense volatility this week, with Bitcoin briefly surging above $90,000 before reversing downward, now oscillating around $88,000. However, market focus is not on the intraday fluctuations but on the epic settlement happening this Friday—the expiration of up to $28.5 billion in Bitcoin and Ethereum options contracts at the world’s largest derivatives exchange, Deribit.

Record-breaking $28.5 Billion Scale Accounts for Over Half of Deribit’s Open Interest

According to Deribit Chief Business Officer Jean-David Pequignot, this settlement is unprecedented. The $28.5 billion in expiring contracts accounts for more than 50% of the platform’s $52.2 billion open interest, indicating that the market will face significant position rebalancing pressure.

Pequignot stated that year-end expiries often symbolize the culmination of an entire year’s trading cycle. This year, however, the market’s characteristics have subtly shifted—from a purely speculative cycle to a more systemic, policy- and macro-driven “super cycle.” This transformation profoundly influences market participants’ decision-making logic and risk management strategies.

Bitcoin Battles Between $88,000 and $90,000

Currently, Bitcoin is oscillating intensely within a narrow range of $88,000 to $90,000. This is no coincidence. Market participants are closely watching the so-called “max pain point”—the strike price at which the most losses are likely to be inflicted on options holders before expiration.

According to Pequignot’s analysis, the current max pain point for Bitcoin is around $96,000. However, downside risks should not be underestimated—there is a large open interest of $1.2 billion in put options (bearish options) with strike prices at $85,000. If these short positions are triggered, they could serve as catalysts for accelerating the decline in Bitcoin’s price.

Bulls Not Fully Out, Mid-term Call Spread Strategies Still in Play

It is worth noting that bullish forces have not completely retreated. The market still shows mid-term call spread strategies at strike prices between $100,000 and $125,000, reflecting traders’ continued confidence in medium- to long-term bullishness. However, the cost of short-term hedging (protective puts) has risen significantly, indicating increased market vigilance against recent volatility.

Traders Roll Positions into January, Upgrading Risk Management Strategies

Most notably, traders are not rushing to close their defensive positions but are instead carefully “rolling” into next month. Specifically, market funds are continuously shifting from December-expiring put options with strike prices between $85,000 and $70,000 to January-expiring put spread strategies with strike prices between $80,000 and $75,000.

This phenomenon reflects a subtle market psychology—investors have taken necessary protections against short-term risks before year-end but remain highly alert to potential price movements in early 2026. Although the $28.5 billion mega-expiry is imminent, market risk awareness has extended into a longer time horizon.