"Triple Witch" $6.5 trillion contracts expire, triggering market turbulence; Bitcoin remains volatile under pressure.

The event of the “Triple Witching” day in June this year has attracted global capital market attention. The largest derivatives contracts in history, totaling $6.5 trillion, are approaching expiration. Coupled with the ongoing tension in Middle Eastern geopolitical situations, market liquidity is constrained, and investor sentiment is volatile. According to the latest data, Bitcoin is currently priced at $90.06K, with a 24-hour increase of +2.33%, and a daily trading volume of approximately $1.42B, overall showing a consolidation trend.

What is Triple Witching? A Quarterly Trigger for Financial Market Volatility

Triple Witching is an important cyclical event in financial markets, occurring on the third Friday of March, June, September, and December each year. The name derives from the simultaneous expiration of three types of derivatives: stock options, stock index futures, and stock index options. The concurrent expiration of these instruments often leads to abnormal trading phenomena, and since the 1980s, industry insiders have likened it to a mysterious “witching hour,” especially during the last hour before market close, which is called the “Triple Witching Hour.”

Historically, this event has also included the expiration of single-stock futures, making it a “Quadruple Witching.” However, since the US ceased trading such futures in 2020, it has evolved into Triple Witching. Historical performance shows that Triple Witching typically results in increased trading volume and heightened price volatility, especially impacting stocks with large derivatives trading volumes and relatively small market capitalization. In recent years, due to the dispersal of options expiration schedules, the impact of this phenomenon has been somewhat mitigated.

$6.5 Trillion Reaches a New High, Liquidity Risks Cannot Be Ignored

The scale of contracts expiring during this Triple Witching is unprecedented. According to Bloomberg, derivatives contracts with a notional value of $6.5 trillion will expire during this period, far exceeding previous records. Data from Investopedia indicates that during the same period in 2019, the total scale was only $6 trillion, showing a significant increase.

The enormous contract size could greatly amplify market activity. Historical data suggests that during past Triple Witching days, stock trading volumes often doubled—for example, in 2019, trading volume reached 10.8 billion shares, well above the average of 7.5 billion shares. If historical patterns repeat, significant market turbulence may occur, especially considering the current tense Middle Eastern situation and low liquidity following the US June holidays, making the market environment more complex.

Market Expectations Vary, Analysts Generally Anticipate Increased Volatility

Market analysts’ specific forecasts for this Triple Witching are somewhat dispersed, but there is a consensus on increased volatility. Research firm Asym 500 notes that since May, US stock intraday volatility has been relatively moderate, mainly due to a “price anchoring effect” caused by a large number of investors engaging in put options early in 2025, leading the S&P 500 to converge around high-volume strike prices.

MarketWatch suggests that the $6.5 trillion contract size could create a complex trading environment, making stocks prone to volatility. A 2021 Nasdaq analysis also confirmed that Triple Witching often triggers sharp price swings. FXStreet further points out that historical data shows an average return of -0.72% on Triple Witching days, implying that trading may lean bearish toward the close.

However, a study by AInvest offers a different perspective—historical statistics show that major indices have about a 60% chance of recording positive returns on Triple Witching days, driven by increased trading volume pushing markets higher. This indicates that market direction remains uncertain, and investor sentiment and macroeconomic conditions will be key factors; Triple Witching does not necessarily lead to declines.

Cryptocurrencies Under Pressure Simultaneously, Risk Alerts and Response Strategies

Although Triple Witching primarily impacts traditional financial markets, cryptocurrencies like Bitcoin and Ethereum have recently shown increasing correlation with stock markets. Rising trading volumes and price volatility in equities may spill over into crypto markets, causing mainstream coins to fluctuate more intensely. Additionally, crypto options (especially Bitcoin options) sometimes expire simultaneously during Triple Witching, and although no major crypto options expirations are scheduled this time, historical experience from 2019 suggests such events could directly impact crypto prices.

In facing potential market turbulence during Triple Witching, investors should exercise caution. Diversifying investment portfolios to avoid over-concentration in a single asset, and strengthening risk management strategies—such as setting stop-loss points and controlling position sizes—are recommended. Maintaining sufficient cash reserves in an environment of uncertain liquidity can also help seize sudden opportunities or respond to unexpected risks.