Week of Jun 22, 2022

Over 100,000 BTC Worth Of Options Expire This Week

A Week Full Of Fed Speeches.

Market Commentary 💬 


It will be a big week for bitcoin with over 100,000 BTC worth of options expiring this Friday. Given the recent price moves, many options will be deeply in or out of the money - in other words, there will be very large payouts from some buyers to some sellers, and vice versa. 

Not surprisingly, open interest in options beyond the June expiration is pretty anemic. The June expiration has more open interest than the monthly expirations for July and September combined. This is probably a foretelling sign of potentially low trading volumes in the coming months.

The futures curves are also displaying some irregular shapes - with the major curves in backwardation or flat (meaning, the future prices are trading lower than the spot price). 

The newsflow has also been unfavorable as of recently, with many anti-bitcoin critics having their victory laps on Twitter. Not to be left out of the conversation, ProShares just announced it is launching a futures-based short bitcoin ETF this week. 

While the timing is certainly interesting, this is not the first short ETF in existence, Horizons has a short bitcoin ETF in Canada. 

Its potential impact on the markets and bitcoin prices will likely be limited - however, it feeds the “short bitcoin” narrative in the mainstream. 

The Fed is likely to continue clobbering markets lower with interest rates, and it will be hard for bitcoin not to get caught in the cross-fire of selling pressure. 

However, we always like to remind our readers that bitcoin is much more than just price. The below chart shows the number of addresses with balances over 0.01 BTC and 0.001 BTC on the network - the image speaks for itself.


Regardless of price, bitcoin continues solving problems for millions of people in places like Venezuela, Nigeria, Afghanistan, Ukraine, China, and many more - block after block.

S&P 500

We’ll start this section with a quote from a Bank of America report from last week: “More than 90% of stocks in the S&P 500 declined today.  It's the 5th time in the past 7 days.  Since 1928, there have been exactly 0 precedents. This is the most overwhelming display of selling in history.”

The Fed-induced selling pressure that has overtaken the stock and bond markets is quickly finding its way into other asset classes:

On the positive side, oil prices are finally taking a breather after a relentless rally. How long it will last remains to be seen. Lots of moving pieces in Europe and the geopolitical landscape. 

A tightening Fed, an active land war in Europe, and shifting political tides in Latin America, all have the elements for further volatility in the year ahead.


Gold has held up remarkably well during the recent market downturn, it is +2.44%  year-to-date. 

This is considering the fact that the real return of the U.S. dollar has increased dramatically since the Fed started raising interest rates. 

Last week gold prices dropped -1.74% as the U.S. dollar index soared once again. The 2 main catalysts for gold could be inflation data or bond interest rate-driven. 


It’s been another wild ride in the world of Decentralized Finance this week. With crypto market conditions deteriorating, several "Decentralized" protocols are coming under tremendous stress, and the pressure is making cracks show under some of the token governance and incentive models. In some cases, a few users or wallets are deciding on the fate of very large sums of money - that belongs to someone else.

Solend, an over-collateralized lending platform on Solana (biggest Dapp in Solana with >270M TVL), had to propose an emergency change to the protocol, giving executive authority to seize the collateral from the biggest wallet in the network to avoid potential on-chain liquidation of the position, that could lead to catastrophic outcomes if SOL price continues to dip.

In a similar fashion, Bancor - a DeFi trading and staking platform on the Ethereum blockchain, recently had to pause its Impermanent Loss Protection (main protocol's feature) after a large user of the protocol started to aggressively withdraw funds. The liquidity drain severely affected Bancor’s ability to guarantee single-sided deposits with no impermanent loss risks.

DeFi is not all bad - the underlying technology can find its niche and serve a purpose. Flash loans, or loans from 0-48 hours can be done efficiently through a capital pool - programmatically.  And it can be done transparently where all actors can verify. However, the way “decentralized” finance governance is currently structured, and the games around the incentive tokens for protocols, are likely going to get an overhaul sooner than later. 



Bitcoin difficulty is set to adjust tomorrow and it will be a slight negative adjustment (approximately -0.52% to 30.10 THs). 

While it is not surprising to see hashrate go down in light of the recent downturn, the interesting thing will be to see how much of it remains on and for how long at current prices. Well run operations should continue to do well, but when conditions tighten up for a prolonged time, mismanaged operations tend to wash out - gradually dropping off or amalgamating hardware under a larger operation.  

What's Ahead

There are a lot of Fed speakers this week, which could impact the market as they discuss their potential next move. St. Louis Fed President James Bullard is one of the most hawkish Fed presidents and he is scheduled to make a speech. Jerome Powell is also scheduled to speak twice during the week. With so much at stake, their words could move markets. 

On the bitcoin front, there is a very large expiration date on Friday. With the big moves that we’ve seen recently, there will likely be some big payouts and losses in the options world come Friday. Volatility could very well be in the cards. 

Keep in mind that we have an active conflict in Europe, which could always re-introduce even more unexpected volatility. 

We hope you enjoyed reading and as always, we wrap up with a summary of the upcoming economic data and earnings reports for the week:


12.00 PM EST - Fed Speech - Loretta Mester (Cleveland Fed)

2.00 PM EST - Fed Speech - Tom Barkin (Richmond Fed)


9.30 AM EST - Fed Speech - Jerome Powell (Chairman of the Fed)

12.50 PM EST - Fed Speech - Charles Evans (Chicago Fed)


10.00 AM EST - Fed Speech - Jerome Powell (Chairman of the Fed)


7.30 AM EST - Fed Speech - James Bullard (St. Louis Fed)

4.00 PM EST - Fed Speech - Mary Daly (San Francisco Fed)

t's a big week coming up, and as always, we'll keep you posted on any relevant news throughout the week right here and from our Twitter account.


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About the author

Mauricio Di Bartolomeo

Mauricio is the co-founder and Chief Strategy Officer of Ledn.io. He grew up in Venezuela where he and his family learned about Bitcoin. Now based in Canada, Mauricio holds HBA and MBA degrees from the Richard Ivey School of Business in London, Ontario in Canada.