Analysts Warn Ethereum Faces Structural Weakness as Bitcoin Shows Signs of Strength

Over $1.2 billion in leveraged positions vanished in less than a day, wiping roughly $200 billion from total crypto market value.

What began as a routine end-of-month cooldown has turned into a high-stakes derivatives event — one that could determine whether the market stabilizes or slips deeper into correction.

A Volatile Setup Before Expiry

Behind the turmoil lies an enormous batch of expiring derivatives. On October 31, contracts representing more than $16 billion in Bitcoin and Ethereum options reached maturity, creating pressure across exchanges from CME to Deribit.

The derivatives desk at Deribit reported nearly 123,000 Bitcoin contracts due to expire, carrying a notional value exceeding $13.5 billion. Analysts pointed out that the “max pain” zone — the price at which most positions lose money — sits around $114,000. That level, they say, could act as a gravitational point for Bitcoin in the short term.

In recent trading sessions, bearish sentiment intensified as protective put buying surged. Deribit’s data shows a sharp spike in downside hedges, lifting the put-to-call ratio to 1.35, a sign that traders are guarding against another leg down before the expiry dust settles.

Ethereum Under Heavier Pressure

Ethereum, meanwhile, faces an even more delicate situation. Some 642,000 ETH options, worth nearly $2.5 billion, are rolling off the books. The structure leans more heavily toward puts — a pattern consistent with traders betting on or shielding against continued weakness.

The key price battleground sits between $3,600 and $4,000, where most open interest is clustered. While the official “max pain” level is closer to $4,100, Ethereum’s inability to reclaim that zone has reinforced the short-term bearish outlook.

Market makers warn that ETH volatility could spike before settling, especially as traders reposition for November contracts.

Divergent Paths for Bitcoin and Ethereum

Not everyone expects the same outcome for both giants. A new report from 10x Research suggests that Bitcoin may have a clearer path to recovery, while Ethereum could face further downside pressure. The firm observed a jump in BTC’s near-term implied volatility — typically a sign of brewing momentum — even as longer-dated options remained steady.

Ethereum’s setup, on the other hand, looks “structurally unstable,” according to analyst Markus Thielen, who argued that ETH’s once-strong institutional narrative has started to unravel. He recommended reducing exposure to Ethereum while maintaining limited, tactical BTC positions.

Institutional Narrative Cracks

For much of the year, Ethereum was championed as a “digital treasury” for institutional portfolios — a yield-bearing asset viewed as the blockchain equivalent of corporate bonds. That enthusiasm, however, has cooled sharply.

Thielen said the summer’s accumulation by funds and treasuries gave way to quiet distribution in recent weeks as ETH lost technical strength. The pattern mirrors broader shifts in crypto capital flows, where investors now respond more to liquidity shifts and ETF flows than to long-term macro trends.

Options Expiry: Turning Point or Trigger?

The question now is whether the market’s reaction to the expiry will stabilize prices or extend the decline. Analysts say a post-expiry rebound remains possible if Bitcoin holds above $110,000, given that many short-term traders are already hedged.

For Ethereum, reclaiming $3,900 would be the first signal of recovery. Until then, both assets remain vulnerable to forced liquidations and algorithmic selling — dynamics that have repeatedly exaggerated volatility in recent months.

The outcome of this $16 billion expiry may well define the tone for November trading: either a fresh start for a shaken market, or another reminder that crypto’s largest catalysts often arrive wrapped in risk.

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