Bitcoin’s price rally (BTC) may have stagnated lately, but the bullish conviction has certainly not done so, since the whales continue to bet on millions in an extended demonstration of the market.
Recently, one of those whales executed a significant upward options aimed at $ 200,000 for the end of the year. The strategy implied the simultaneous purchase of 3,500 contracts of the December purchase option of $ 140,000 of currencies and the short sale (or writing) of 3,500 contracts of the December purchase option of $ 200,000.
This complex trade, a Toro call differential, resulted in an initial net debit of $ 23.7 million. As Deribit Insights pointed out, “the December call differential, 140-200k dominates, buying low in December 140k IV, financed by higher called IV of 200k.”
The strategy will achieve maximum benefit if BTC is established at or above the highest year price, $ 200,000 in this case, before the expiration date.
This strategy generates a net debit because the premium paid by the lowest strike purchase option (the purchase) exceeds the premium received from selling the highest strike call. The differential offers limited profits for a limited risk, limiting up to $ 200,000, while ensuring that the maximum potential loss is contained in the initial debit.
The options are derived used to speculate or coverage against price movements. A purchase option gives the buyer the right, but not the obligation, to buy the underlying asset at a predetermined price in or before a specified future date. A call buyer is implicitly optimistic in the market, while a buyer Put is bassist.
The Bitcoin spot price reached a maximum record of more than $ 123,000 on July 14 and since then has established itself in a limited range between $ 116,000 and $ 120,000.
Registration options activity
The BTC price rally and the growing institutional interest in structured products, which imply the sale of volatility, have increased activity in the options market.
In Delibit, which represents more than 80% of the activity of the global options, the open BTC options for interest, or the number of open options contracts, was 372,490 BTC from writing, just a record of 377,892 established in June.
Meanwhile, the open interest in the ether options has reached a record of 2,851,577 ETH, according to the Amberdata data source. In Delibit, an option contract represents a BTC or ETH.
