Bitcoin to dump while Ethereum pumps? A look at Options data reveals…

Both Bitcoin [BTC] and Ethereum [ETH] led the crypto recovery that started last week. However, their returns fell this week. At the time of writing, BTC’s price was trading above $79,000 while ETH’s was valued at around $2,500.

Now, while the broader outlook may be bullish, it is interesting to note that institutions are betting on a BTC dump and ETH pump simultaneously. Hence, the question: Is this bet a signal that altcoins could outperform Bitcoin, particularly Ethereum?

A look into expiring Bitcoin options—bulls in full control!

According to Deribit, more than 81,700 BTC worth $6.40 billion in Bitcoin Options expire on Friday, 28th August, at 4.00 AM ET. These include $236 million in Call Options at $75K, $157 million in calls at $80K, and a max pain level of $68K.

Much of this position, accounting for more than $2.70 billion in all Call Options, was placed before BTC’s move. This data indicated that bulls were in full control of BTC’s price while bears were completely under water.

Still, the Term Structure also suggested calm near-term conditions but more uncertainty or big events further in the future. The explanation being that at press time, this metric was rising for BTC with a reading of 42.66.

Institutions bet on BTC dumping and ETH pumping

Open Interest by Strike Price at the end of September revealed that institutions may be betting on a BTC dump and an ETH pump simultaneously.

The highest concentration of BTC Options was at $70K. The notional value for calls at this level was $874 million with a Put/Call ratio of 0.52, reinforcing this bearishness.

For context, institutions like Metaplanet have been offloading their holdings. According to Lookonchain, the Bitcoin miner deposited 1,350 BTC worth $108 million into Coinbase Prime, potentially to sell.

On the other hand, the concentration of ETH Options indicated that most institutions were betting the altcoin would be above $3,000 by the end of September. The notional value for the 39,999 calls was $99 million with the max pain at $2,100.

For instance, Bitmine’s ETH position is now close to $14.4 billion. Such a scenario could trigger altcoins’ outperformance of Bitcoin.

Put simply, based on the Options data, it seemed pretty evident that there may be a disparity in institutional projections for BTC and ETH. So, will their prices comply?

What to expect by the end of September?

At the time of writing, both cryptos were trading within constricted Bollinger Bands. This suggested that the uptrend had cooled off.

A break above the aforementioned key levels would extend their rallies while failure at the zone would trigger a correction.

Final Summary

• Bitcoin Options worth more than $6.50 billion will expire soon. 
• Near-term outlook suggested that institutions have contrarian bets on both Bitcoin and Ethereum.