Bitcoin Bulls Set Their Sights on $110,000: What You Need to Know Before the May 30 Options Expiry

As Bitcoin (BTC) approaches its largest monthly options expiry of 2025, excitement is building among investors. With a total exposure of $13.8 billion, Bitcoin bulls are eyeing an ambitious target of pushing BTC above $110,000 by May 30 to capitalize on a significant $4.8 billion in call options. This anticipated movement follows a remarkable 25% rally over the past month, catching many bears off guard. In this article, we’ll explore the implications of this expiry, the market dynamics at play, and the potential scenarios that could unfold.

Understanding the Market Dynamics

The current open interest in Bitcoin puts, which are sell options, stands at a notable $6.5 billion. However, it’s important to highlight that 95% of these positions are set below $109,000. Should Bitcoin’s price remain near current levels, less than $350 million worth of put options will have relevance by the expiry. Conversely, Bitcoin calls, or buy options, hold an open interest of $3.8 billion, primarily concentrated up to $109,000. This imbalance reveals that not all call option holders are necessarily bullish; some may use these options to hedge exposure above specific price thresholds, influencing market sentiment.

Recent transactions at Deribit—a prominent options exchange—reveal some pivotal trading strategies. For instance, many investors have engaged in “short call” strategies, seeking fixed-income returns while betting on Bitcoin’s price to remain above a certain level. Another common tactic is the “bull call spread,” which aims to guard against downside risk while giving up potential gains past a specified price point.

Strong Bitcoin ETF Inflows Strengthen the Bulls’ Position

Maintaining the price at the $109,000 level could result in positive outcomes for bullish strategies in the imminent May options expiry. Nonetheless, bears may try to exert influence over BTC futures markets as the expiry date approaches. Currently, the total open interest for Bitcoin futures is pegged at $79 billion, presenting strong demand for short positions. Be wary, though, as this could backfire if Bitcoin pushes beyond $110,000, potentially forcing many bearish investors to close their positions.

Recent net inflows of $1.9 billion into US spot Bitcoin exchange-traded funds (ETFs) from May 20 to May 22 indicate robust demand for Bitcoin above the $105,000 marker. The central hope for bears lies in a deteriorating macroeconomic climate, which may stifle demand for Bitcoin and amplify risk aversion among investors.

Related Insights: Bitcoin Hits New Highs in the Absence of ‘Unhealthy’ Leverage Use

Scenarios for Bitcoin By May 30

Given the current market dynamics, let’s explore four possible scenarios based on prevailing price trends and the open interest imbalances:

• Between $102k and $105k: The call options total $2.75 billion against $900 million in puts, favoring calls by a net of $1.85 billion.

• Between $105k and $107k: Calls reach $3.3 billion versus $650 million in puts, with a net advantage for calls of $2.65 billion.

• Between $107k and $110k: Here, calls are at $3.7 billion while puts linger around $350 million, putting calls ahead by $3.35 billion.

• Between $110k and $114k: A significant advantage for calls emerges with $4.8 billion in calls against a meager $120 million in puts, yielding a net favor of $4.7 billion for calls.

For Bitcoin bulls, driving BTC above $110,000 not only maximizes potential gains but also opens the door to establishing a new all-time high. However, this bullish momentum is contingent upon various factors, including ongoing geopolitical tensions, such as the tariff war, which remains a critical focus in economic discussions.

Final Thoughts

As the May 30 options expiry approaches, the interplay between bullish and bearish forces in the Bitcoin market highlights the inherent volatility and unpredictability of cryptocurrency trading. While bulls hold a favorable position with strong call option exposure, the looming expiry could lead to rapid shifts in market dynamics. Investors should remain vigilant and informed as they navigate these turbulent waters.

This article serves to encapsulate current developments and market sentiment regarding Bitcoin. Engage with these insights, but remember, this is not financial advice. Always consider your investment strategy carefully and stay updated with market trends.

For more detailed analysis on cryptocurrency trends, check out our section on Bitcoin Strategies and explore how recent market movements could shape your investment path!