Crypto’s Boxing Day Drama! 😱

by

Markets

What to know:

  • So, apparently, $27 billion worth of crypto options are expiring. Like, that’s a lot of zeros. Honestly, it’s making my head spin, and all I have to worry about is whether I remembered to buy fig rolls.
  • Turns out everyone’s feeling relatively optimistic (or maybe just delusional) because there are way more “call” options (betting prices will go UP) than “put” options (betting they’ll go DOWN). Classic. 🙄
  • Deribit (who seem to be in charge of all this…exhilarating…stuff) reckon it’ll be less chaotic than last year. Thank goodness. I don’t need any more drama in my life, thanks.

Right. So, the crypto world is bracing itself for a “massive structural reset” on Friday. Which, if we’re being honest, sounds vaguely threatening. It involves a frankly terrifying amount of money-$23.6 billion in Bitcoin options and $3.8 billion in Ether options-all expiring on something called “Deribit”. It’s like someone decided to play Monopoly with the global economy. 🤷‍♀️

This whole thing is being helpfully called a “Boxing Day” event (because…it happens near Boxing Day? Logistics, people!). These options basically vanish into thin air on Friday, and the people who had them have to settle up. It’s like a very complicated, very expensive bill arriving all at once.

Apparently, according to Deribit, there’s a lot of “bullish positioning” which means people are expecting things to go up. Though, let’s be real, expecting things to consistently go up in crypto is… optimistic. It’s a bit like expecting a date from a dating app to actually look like their profile picture.

Sidrah Fariq from Deribit (who sounds very important) said on Telegram (where everyone gets their financial advice) that the “max pain level” is around $96,000. The “max pain level” is where people lose the most money. Lovely. It’s like they’re deliberately designing this to be stressful. 😫

Basically, options are a way to bet on whether something will go up or down. Call options? Optimistic. Put options? Pessimistic. Seems straightforward enough, until you realize there are billions of dollars floating around. 💸

The ‘max pain’ magnet

“Max pain” is something people watch closely. The theory is that traders will try to nudge the price towards this “max pain” level, because, well, profit. It’s a bit like a sophisticated form of market manipulation. Or, you know, just really aggressive trading. Either way.

Supporters of this theory suggest (and I use that word very lightly) that Bitcoin could hit $96,000 and Ether $3,100. Don’t spend it all yet, though. It’s just a suggestion. From the internet. 🙃

But, honestly, the whole “max pain” thing is a bit controversial. Many people think it’s complete nonsense. Which, maybe it is. Who knows anymore?

Bullish bias meets holiday lull

So, the “put-call ratio” is 0.38. Which means for every 100 people betting things will go up, there are only 38 betting they’ll go down. Clearly, everyone is feeling very positive. Or just ignoring all the warning signs. It’s a lifestyle choice, really.

Loads of people are betting on Bitcoin going to a truly breathtaking $100,000 to $116,000. (Honestly, it’s starting to feel like a wishful thinking competition.) Meanwhile, a small number of contrarians are hedging their bets on the downside.

Apparently, people are scrambling to “roll over” their options, which means shifting them to a later date. It’s like postponing your taxes. Deals with it later!

Sidrah Fariq says this could all be relatively calm. Volatility is “contained” (whatever that means) and the holiday season means things are a bit…slow. Apparently. Still though… it’s a lot of money! 😬

The “DVOL” (which is a fancy way of measuring how much the market is freaking out) has come down from a terrifying 63% to a slightly less terrifying 45%. Meaning people are starting to feel slightly less panicked.

Basically, the market isn’t expecting a complete meltdown. Although, honestly, in crypto, you can never be too sure. It’s always an adventure. A stressful, potentially bankrupting adventure. But an adventure nonetheless. 🤷

Read More

2025-12-22 13:19