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Crypto World

How WIll BTC and ETH React?

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Will Huge $8.3B Bitcoin Options Expiry Trigger Another Dump?


Another week has ended, and it is also the end of the month, which means a bigger batch of Bitcoin and Ether options contracts are expiring while spot markets cool off again.

Around 115,500 Bitcoin options contracts will expire on Friday, Feb. 27, with a notional value of roughly $7.8 billion. This event is much larger than usual because it is the end of the month, so there could be a little volatility on spot markets.

Crypto markets have seen a little daylight with a mid-week lift, but total capitalization has remained the same as gains are starting to erode again, and zooming out shows they’re still in a downtrend.

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Bitcoin Options Expiry

This week’s batch of Bitcoin options contracts has a put/call ratio of 0.76, meaning that there are more expiring calls (longs) than puts (shorts). Max pain is around $75,000, according to Coinglass, which is way above current spot prices, so many will be out of the money on expiry.

Open interest (OI), or the value or number of Bitcoin options contracts yet to expire, remains highest at $60,000 with $1.5 billion and $1.1 billion at $50,000 strike prices on Deribit as bearish bets increase. Total BTC options OI across all exchanges has been climbing this month and has reached $37 billion.

“In a continuous downtrend in the existing range, it’s not a surprise to see ongoing downside plays (protection and bearish) on BTC,” said Deribit this week.

“Call OI dominates across both assets, with BTC carrying the significantly larger notional weight into settlement.”

Derivatives provider Greeks Live said the expiration of options accounts for 20% of total open interest, totaling nearly $9 billion, with Bitcoin’s position share reaching a multi-year peak.

“The market remains firmly in bear territory. Currently, the crypto space lacks both fresh capital inflows and clear catalysts, with pessimistic narratives dominating social media. The market bottom likely remains elusive.”

In addition to today’s oversized batch of Bitcoin options, around 477,000 Ethereum contracts are also expiring, with a notional value of $963 million, max pain at $2,200, and a put/call ratio of 0.77. Total ETH options OI across all exchanges is around $6.6 billion. This brings the total notional value of crypto options expiries to around $9 billion.

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Spot Market Outlook

Markets are back in the red again today with total cap dropping 1.3% below $2.4 trillion. Bitcoin failed to hold above $68,000 and dipped back below $67,000 during early trading in Asia on Friday morning.

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Ethereum is teetering around the $2,000 level and is likely to fall below it again as any hopes of a relief rally dwindle.

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Crypto World

CFTC Staff Share FAQ on Crypto Collateral

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CFTC Staff Share FAQ on Crypto Collateral

The US Commodity Futures Trading Commission has given more details on its expectations for the use of crypto as collateral amid a pilot program that the agency launched last year.

In a notice on Friday, the CFTC’s Market Participants Division and Division of Clearing and Risk responded to frequently asked questions that emerged from two staff letters issued in December that established a pilot allowing crypto to be used as collateral in derivatives markets.

The notice reminded futures commission merchants wanting to take part in the pilot that they must file a notice with the Market Participants Division “which includes the date on which it will commence accepting crypto assets from customers as margin collateral.”

The crypto industry has argued that crypto technology is best suited for 24-7 trading and instant settlement, and the CFTC’s guidance in December clarified what tokenized assets can be used as collateral, along with how to value them and calculate how much is needed for a trading position.

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CFTC aligns guidance with SEC

The CFTC made clear its guidance was to align with the Securities and Exchange Commission, as the two agencies work together on a regulatory framework for crypto.

The CFTC said that capital charges, the amount that must be held to cover losses, would be “consistent with the SEC” and that futures commission merchants should apply a 20% capital charge for positions in Bitcoin (BTC) and Ether (ETH), while stablecoins should get a 2% charge.

Source: Mike Selig

The notice added that futures commission merchants taking part in the pilot can only accept Bitcoin, Ether, or stablecoins for the first three months and must give prompt notice of any significant cybersecurity or system issues. They must also file weekly reports of the total crypto held across customer account types.

After the three-month period, other cryptocurrencies can be accepted as collateral and the reporting requirements will end.

Related: SEC interpretation on crypto laws ‘a beginning, not an end,’ says Atkins

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The notice also clarified that “only proprietary payment stablecoins may be deposited as residual interest in customer segregated accounts” and that futures commission merchants can’t accept other cryptocurrencies for that purpose.

The CFTC said that crypto and stablecoins cannot be used for collateral of uncleared swaps, but swap dealers can use tokenized versions of an eligible asset if it meets regulatory requirements and grants the holder the same rights in its traditional form.

Meanwhile, derivatives clearing organizations can accept crypto and stablecoins as initial margin for cleared transactions if they meet CFTC requirements regarding minimal credit, market, and liquidity risks.

Magazine: How crypto laws changed in 2025 — and how they’ll change in 2026

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