Today is December 26th, and over $27 billion worth of Bitcoin and Ethereum options are set to expire.

It can be said that the crypto market is on high alert today, as the scale of options expiring on Deribit could be the most critical reset of the year, amounting to about $27 billion, which is more than half of their open contracts. The number of call options here is nearly three times that of put options, suggesting that the sentiment seems to be slightly bullish.

But here comes the key point: the market is not focused on how bullish or bearish it is, but rather on where the settlement will occur.

So where is the maximum pain point?

BTC is around 95,000, and ETH is around 3,000. What does this mean? If the price approaches these levels, the option sellers are most comfortable, while buyers are the most uncomfortable. Therefore, before and after expiration, institutional hedging, closing positions, and rolling over will significantly influence the price.

The most obvious phenomenon in the market now is that everyone is rolling over.

Many institutions are moving their positions to January contracts to reduce year-end risks, which is why you see short-term data fluctuating.

Will the outlook for January next year be bearish or bullish?

Although bearish sentiment accounts for about 30% of recent large trades, this does not mean that market sentiment has completely turned bearish. Institutions often use put options for hedging, locking in downside risks; as expiration approaches, they may also transfer remaining positions to willing buyers, creating a seemingly bearish data outlook, but essentially it is risk management.

Interestingly, volatility has actually decreased. The 30-day implied volatility DVOL for Bitcoin is currently around 42%, significantly lower than the 63% at the end of November, indicating that the market may not surge as everyone thinks, and the settlement may be more orderly. Because the real drama happens after expiration, how capital flows is more important than price.

Next, I will be watching two ranges: on the upside, bullish bets are concentrated between BTC 100,000 and 116,000; on the downside, the most popular bearish bet is still 85,000. Ethereum is similar, with a focus above 3,000.

How institutions handle these positions may determine how the first few weeks of 2026 will unfold.

Today marks the 14th day of “extreme fear,” and if the Federal Reserve pauses interest rate cuts in the first quarter of 2026, risk assets may take another hit. There are even voices saying that if rates are not cut, BTC could go to 70,000.