Bitcoin’s recent bullish momentum has hit a speed bump amid renewed macroeconomic uncertainty, particularly due to former U.S. President Donald Trump’s proposed tariff policies. With a massive $13.8 billion in monthly options set to expire on May 30, 2025, market participants are closely watching whether bulls can overcome headwinds and drive the price above $110,000.
This looming expiry presents a pivotal moment for Bitcoin (BTC) traders. Historically, options expiries can amplify volatility and influence short-term price direction, especially when there's a significant imbalance between call (bullish) and put (bearish) positions. In this case, the structure of open interest heavily favors the bulls—if they can maintain upward pressure.
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Bitcoin Options Landscape: A Bullish Bias at Expiry
As of late May 2025, Bitcoin’s options market shows a striking asymmetry. Total open interest stands at $13.8 billion, with $6.5 billion in put options—mostly concentrated below $109,000. Notably, 95% of these bearish contracts are priced beneath that level, meaning they will expire worthless if BTC holds firm or climbs higher.
On the flip side, $3.8 billion in call options are positioned below $109,000, indicating strong bullish positioning. More importantly, an additional $4.8 billion in call options are structured at or above $110,000. If Bitcoin clears this psychological and technical barrier before expiry, those positions stand to generate substantial gains.
This imbalance creates what traders call a pin risk—a scenario where market makers and large institutions may actively push the price toward levels where the most options expire worthless (i.e., maximizing seller profits). In this case, the incentive leans toward keeping Bitcoin near $110,000, but not necessarily above it—unless demand from spot markets or ETFs intervenes.
ETF Inflows Signal Strong Underlying Demand
Despite short-term volatility, fundamental demand for Bitcoin remains robust—particularly through spot Bitcoin exchange-traded funds (ETFs). Between May 20 and May 22 alone, U.S.-listed Bitcoin ETFs recorded net inflows of $1.9 billion. This surge underscores sustained institutional and retail appetite, even at prices above $105,000.
Such consistent capital inflows reduce the likelihood of a sharp correction. Unlike speculative futures positions, ETF holdings represent long-term conviction. When combined with historically low exchange reserves and increasing adoption by corporations and sovereign wealth funds, the macro backdrop remains structurally supportive for higher prices.
Moreover, short positions in the futures market—totaling $7.9 billion in open interest—are increasingly vulnerable. A sustained move above $110,000 could trigger a short squeeze, forcing leveraged bearish traders to cover their positions rapidly, further fueling upward momentum.
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Four Scenarios Leading Up to Expiry
Given the current distribution of open interest, we can model four plausible price ranges ahead of the May 30 expiry and assess their implications:
$102,000 – $105,000 Range
At this level, $2.75 billion in call options would be in-the-money versus just $900 million in put options. The net positive outcome for bulls totals $1.85 billion—an early sign of dominance.
$105,000 – $107,000 Range
Bullish momentum strengthens: $3.3 billion in calls vs. $650 million in puts yields a $2.65 billion net advantage for longs.
$107,000 – $110,000 Range
The gap widens further: $3.7 billion in profitable calls against only $350 million in active puts results in a $3.35 billion edge for bulls.
$110,000 – $114,000 Range
This is the sweet spot for maximal impact. With $4.8 billion in calls activated and merely $120 million in relevant puts remaining, the net bullish advantage soars to $4.68 billion—the highest among all scenarios.
These figures suggest that every dollar gained beyond $110,000 significantly increases the financial pain for bears and rewards for bulls. As such, pushing past this threshold isn’t just symbolic—it’s economically strategic.
Market Structure and Trading Strategies in Play
Looking deeper into Deribit trading data over the past two weeks reveals popular strategies reflecting cautious optimism:
- Short Call Writing: Traders sell out-of-the-money call options to collect premium income, betting that Bitcoin won’t surge too rapidly.
- Bull Call Spreads: Investors buy a lower-strike call while selling a higher one—limiting upside but reducing cost and hedging downside risk.
These strategies indicate that while many traders expect moderate gains, few are positioning for explosive moves beyond $114,000—potentially setting the stage for a surprise breakout if macro conditions improve.
Macroeconomic Risks: The Wildcard
Despite favorable technical and structural conditions, external risks linger. Trump’s proposed tariffs on Chinese imports could reignite inflation fears and tighten monetary policy expectations. Such a shift might strengthen the U.S. dollar and pressure risk assets—including cryptocurrencies.
However, Bitcoin has increasingly shown decoupling behavior from traditional markets during geopolitical stress. Some analysts argue that trade tensions could actually boost BTC’s appeal as a hedge against currency devaluation and capital controls—especially if global liquidity expands in response.
Thus, while tariffs pose a near-term threat to sentiment, they may inadvertently reinforce Bitcoin’s narrative as digital gold.
Frequently Asked Questions (FAQ)
Q: What happens when Bitcoin options expire?
A: When options expire, contracts are either exercised (if in-the-money) or become worthless (if out-of-the-money). Large expiries can influence short-term price action as traders adjust positions.
Q: Why is $110,000 such an important level?
A: It aligns with major call option strikes and represents a psychological milestone. Clearing it could trigger technical buy signals and force short-covering.
Q: How do ETF inflows affect Bitcoin price?
A: Sustained inflows indicate strong demand from institutional investors, supporting higher prices by reducing available supply on exchanges.
Q: Can macro events like tariffs stop Bitcoin’s rally?
A: They may cause short-term pullbacks, but Bitcoin often rebounds quickly during periods of financial uncertainty due to its scarcity and decentralization.
Q: What is a short squeeze in crypto futures?
A: It occurs when rising prices force leveraged short sellers to close positions, accelerating upward momentum due to forced buying.
Q: Are options markets reliable predictors of Bitcoin’s price?
A: Not perfectly—but open interest imbalances can highlight key levels where market participants have concentrated risk, offering clues about potential price targets.
Final Outlook: Bulls Hold the Edge—But Vigilance Required
The confluence of strong ETF demand, lopsided options positioning, and elevated short interest gives Bitcoin bulls a structural advantage heading into the May 30 expiry. While geopolitical noise poses risks, underlying market dynamics favor continued appreciation.
For traders and investors alike, the path to $110,000—and beyond—is no longer just speculative; it's supported by measurable flows and incentives embedded in derivatives markets.
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With over $4.8 billion in call options poised to benefit from a move above $110,000, the incentive for coordinated buying pressure is clear. Whether macro forces allow it remains to be seen—but for now, the odds are tilting in favor of the bulls.
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