Bitcoin’s decline heading into Friday’s quarterly options expiry has once again raised questions around the “max pain theory,” as the market trades far below the widely cited $72,000 level.
The cryptocurrency’s move down to roughly $61,700 comes ahead of about $10 billion in options expiring on Deribit at 8:00 ET Friday, reviving debate over whether prices tend to gravitate toward max pain levels before major settlements.
Max pain refers to the strike price at which options buyers—holders of calls and puts—would incur the greatest losses at expiry, while option sellers stand to gain the most.
The theory suggests that option writers may try to influence spot prices toward that level ahead of expiry, creating a so-called pinning effect around max pain. It gained traction after BTC frequently appeared to move toward those levels during several 2020–2021 monthly and quarterly expiries.
However, this week’s drop from around $67,000 to below $60,000 has pushed prices further away from the $72,000 max pain level, challenging that narrative.
The move also echoes skepticism from market participants such as Tony Stewart of Pelion Capital, who has long argued that max pain has limited explanatory power in crypto markets.
Recent expiries have likewise shown little evidence of consistent price pinning, further weakening confidence in the theory.
“Friday’s expiry is something to watch with $10.2 billion rolling off Deribit and max pain at $72,000, well above spot,” said Wintermute OTC trader Jasper De Maere. “Despite the narrative, recent expiries haven’t mechanically pinned prices the way people expect.”
Still, the event remains significant, with Deribit calling it one of the year’s largest liquidity rollovers, a development that can still drive heightened volatility as traders close or roll positions.
