Bitcoin struggled to maintain its momentum in the second half of January after its big start to the year.
Bitcoin price has flattened (even as other, smaller cryptocurrencies continue to rise) as fears of a swelling Bitcoin bubble mount.
Now, with excitement mounting ahead of a highly anticipated Bitcoin Corporate Strategy virtual summit in the first week of February, nearly $ 4 billion worth of bitcoin options will expire this Friday, January 29th.
Bitcoin price has moved sideways since peaking in early January, at over $ 40,000 per bitcoin.
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Bitcoin options contracts, with which investors can buy or sell the cryptocurrency within a specified period of time at a certain price, with a value of around 107,000 Bitcoin or 3.5 billion US dollars at today’s prices, are running according to data from the cryptocurrency analysis provider bybt.com on Friday. The impending expiration of the options is well above the $ 2.4 billion record set in late December.
Trade data shows speculators are optimistic about Bitcoin, although recent polls show Wall Street investors think Bitcoin is a bubble. There is currently an open interest in “call options” – betting that the price of Bitcoin will rise – rather than “puts” – betting that the price will fall.
The looming expiry of record options in Bitcoin could lead to price volatility as previous large expiry times grab investors’ attention and the size of the Bitcoin open interest market has been growing sharply recently – more than doubling since the summer.
Bitcoin’s surge in recent months, which has risen nearly 250% since October, has not dampened its extreme volatility. Bitcoin price fluctuated regularly by more than 10% during a 24-hour trading period. Bitcoin price is currently over 20% below its early January all-time high of just over $ 40,000.
$ 3.5 billion worth of bitcoin options expire on January 29th.
Last week, survey data revealed that investors fear Bitcoin could halve in the coming year. 50% of respondents to a Deutsche Bank survey gave Bitcoin a rating of 10 on a bubble scale of 1 to 10. According to Bank of America’s BAC, Bitcoin is currently the world’s busiest trade among investors it has surveyed and has been for the first time since October 2019 Tech stocks ousted from the top.
Elsewhere, analysts at Wall Street giant JPMorgan JPM have warned that a Bitcoin exodus could occur if the price does not hit its highs of $ 40,000 soon.