Bitcoin Trades Far Below Max Pain Level Ahead of $10B Options Expiry

Bitcoin was trading far below the so-called max pain level ahead of Friday’s quarterly options settlement, casting fresh doubt on a theory widely discussed in crypto markets. According to CoinDesk, BTC had fallen from about $67,000 to below $60,000 on Wednesday before trading around $61,700, while the max pain level for the expiry stood near $72,000.

The gap matters because max pain theory suggests that prices may drift toward the level where options buyers lose the most money at expiry, benefiting options sellers. With roughly $10 billion in options scheduled to expire on Deribit, the world’s largest crypto options exchange, the current setup does not support the idea that bitcoin is being pulled toward that level.

Max pain has been a recurring market narrative, especially after bitcoin appeared to move toward similar levels before some monthly and quarterly expiries in 2020 and 2021. CoinDesk noted that those earlier patterns may have been partly coincidental or driven by other market forces, but they helped make the theory popular across crypto social media.

Recent expiries have offered less evidence of a strong price-pinning effect. Jasper De Maere, an OTC trader at Wintermute, told CoinDesk that the $10.2 billion Deribit expiry is worth watching, but recent options expiries have not mechanically pinned prices in the way many traders expect.

That does not make the expiry irrelevant. Deribit has described the June settlement as one of the year’s largest liquidity events, with billions of dollars in contracts expiring or being rolled into later dates. For traders and market watchers, the main takeaway is not a guaranteed move toward $72,000, but the possibility of heightened volatility around a major derivatives event.