The CME Bitcoin Futures Expiration comes on the last Friday of every month, and as explained in previous articles on Crypto.IQ, the CME Bitcoin Futures Expiration often causes significant volatility. It also marks pivot points for the market, i.e. oftentimes a bearish or bullish trend starts after the expiration and continues for the rest of the month.

September’s expiration is special however, since not only are a large amount of futures contracts expiring, but $1 billion of Bitcoin Options contracts are expiring as well. 

Essentially, Bitcoin Options are a different way of betting on the future of Bitcoin’s price, and until recently the Bitcoin Options market was miniscule compared to the futures market. However, Bitcoin Options volume has grown by hundreds of percent in just a few months, and now the Bitcoin Options expiration could have significant impacts on the market, and this will add to the effects caused by the futures expiration.

Zooming out, Bitcoin has had a relatively bearish month, with its price declining from around $11,500-$12,000 at the last expiration to $10,500 currently. It is possible that this Friday’s expiration could give the Bitcoin market a fresh and bullish start.

On the other hand, Bitcoin could continue to be bearish in October as well, and it will be important to watch the market trends during the week after the expiration, since that will be a solid indicator of which direction Bitcoin will go for the rest of the month.

Thus, Friday is a big day for the crypto markets, with the dual expiration of CME Bitcoin Futures and Options contracts, and significant volatility is possible this week as the expiration approaches and unfolds. After the expiration it will be important to monitor which way the market goes, since that could set the tone for the rest of the month.