Options are derivative contracts granting the buyer the right, but not the obligation, to trade an asset at a fixed price by a set date. Sellers receive a non-refundable premium in exchange for assuming the risk of potential payouts if the market moves against them. On platforms like Deribit, these settlements occur in BTC or USDC.
The Max Pain level represents the price point at which total payouts to option holders are minimized, allowing sellers to retain the maximum amount of premiums. This level is calculated by aggregating potential payouts across all open contracts for a specific expiration date. Analysts debate whether market prices truly gravitate toward this level.
As of September 24, 2026, the Max Pain for Bitcoin options on Deribit was approximately $75 000, roughly $10 500 below the market price. This specific expiration date accounted for $15,9 billion in nominal value, representing 37% of the total open interest for Bitcoin on the exchange.
Traders employ various strategies, including spreads and straddles, to manage risk and profit from market volatility. Data from September 24 showed that calendar spreads with puts accounted for 54,5% of combined Bitcoin option trades, while call-based calendar spreads made up 26,5% of the volume.
Options are categorized as 'in the money' or 'out of the money' based on the strike price relative to the underlying asset's market value. European-style options, common on Deribit and CME, do not allow for early exercise. CME specifically offers options on futures, meaning settlement results in a futures position rather than the underlying asset.
