$14 billion of bitcoin options expire tomorrow, but geopolitical tensions remain key driver of volatility

Bitcoin is down 3.5% over the past 24 hours, trading at the $69,000 level as increased uncertainty about the direction of the conflict in the Middle East, underscored by President Trump’s post warning Iran to “get serious soon, before it is too late,” weighs on the market.

But there’s another event that could add volatility to bitcoin: $14 billion of options, representing 40% of open interest on Deribit, will expire Friday.

Sidrah Fariq, global head of retail at Deribit, told Sherwood News that $75,000 is the “max pain level.”

For those unfamiliar, Arkham explains the max pain level is “a price level where, theoretically, the maximum number of options expire worthless, resulting in the greatest loss for option buyers and the greatest gain for option sellers.”

Fariq said that going into large expiries, hedging flows tend to pull spot trading toward max pain, making it “a natural magnet.”

“With a put/call ratio around 0.63, positioning looks orderly despite geopolitical noise. We’re seeing a controlled setup, volumes have compressed, and institutions continue to overwrite calls higher, capping near-term upside,” Fariq said.

Fariq added that BTC DVOL (Deribit’s 30-day forward-looking index that measures bitcoin volatility based on option prices) in the low 50s reinforces the muted tone.

“Bitcoin had held up well through uncertainty, but a sustained move higher likely needs a fresh catalyst post-expiry,” Fariq said.

Bitcoin has been searching for a catalyst for months, and despite investors clinging to any bit of good news, the asset has remained stuck in a tight range.

Max Kahn, CEO of Digital Wealth Partners, told Sherwood that while Friday’s $14 billion bitcoin options expiry is big, the size doesn’t make it a turning point by itself.

What these expiries actually do, Kahn said, is create gravitational pull in the days leading up to them, as market makers hedging their books push price toward max pain, which is why bitcoin tends to go sideways before a major expiry.

“Dealers are just managing exposure,” he said.

Kahn said that the more interesting moment is what happens after, since once the expiry clears, that hedging pressure disappears and you can get a volatility spike as positions unwind.

“How sharp depends on the calls-to-puts ratio and whether dealers have to scramble to rebalance. A lopsided book means more aggressive hedging, which means bigger moves either way,” he said.

However, he added that this expiry won’t override the macro picture.

“ETF flows and broader liquidity are what’s actually driving the trend. The expiry accelerates whatever’s already happening; it doesn’t flip it,” he said.

Several experts agreed, saying the expiry won’t be a factor in bitcoin’s price movement in the long term, as macro and geopolitical drivers continue to dictate its trajectory.

Nic Puckrin, CEO and cofounder of Coin Bureau, told Sherwood that he’d expect to see range-bound trading around the $75,000 level, rather than a clear breakout higher. That’s only if bitcoin is trading close to that level already on Friday, as $75,000 can act as a magnet, but there’s no guarantee we will get there.

Puckrin added that the max pain point is a theoretical construct, with the idea that option dealers will try to influence the price to keep it close to that level.

“So it’s a short-term thing. Once those options expire, it’s right back to the exact same fundamentals that were driving the price beforehand,” he said, adding that volatility will likely pick up, but this event isn’t a long-term driver for BTC price — macro conditions and ETF flows have a far bigger influence overall.

Finally, Glassnode analysts said that what stands out in this expiry is market makers positioned within a corridor of short gamma (which amplifies volatility), concentrated between $70,000 and $75,000 — a zone where price can accelerate in either direction, they said in a report.

“Once this positioning clears, the market is likely to become less constrained by hedging flows and more responsive to external drivers. In that context, broader macro conditions are expected to play a larger role in determining where BTC finds its next equilibrium,” they said.