BlackRock’s bitcoin exchange-traded fund (ETF) options made a dramatic debut on Tuesday, registering nearly $1.9 billion in notional trading volume. A large portion of the activity was concentrated in call options, with traders expressing a bullish outlook on the ETF’s price. In particular, there was notable interest in the $100 strike price, suggesting that many expect bitcoin’s value to double in the coming months.
The ETF closed the day at $52.70, but the significant trading volume in the $100 call options, especially those expiring on December 12, indicates growing confidence in a sharp upward movement in the asset’s price. Over 32,000 contracts for the $100 strike were traded, marking the highest activity for the day. “It’s fascinating to see professionals betting on such a large price increase,” said Samneet Chepal, a crypto quant researcher, highlighting the market’s expectations.
This activity mirrors trends seen on the Deribit exchange, where the $200,000 strike call options for bitcoin are also experiencing strong interest, further suggesting that institutional players are preparing for a potential surge in bitcoin’s price.
On Tuesday, the $55 strike call option was the most traded IBIT option, with call options overall accounting for four times the volume of puts. This dominance of call options reflects widespread optimism about bitcoin’s price trajectory. Call options give traders the right, but not the obligation, to buy the underlying asset at a set price, and they are typically used when investors expect significant price gains.
As U.S. institutions and retail investors gain access to IBIT options, experts predict that the influx of new participants could increase market volatility and possibly trigger gamma squeezes—situations where rapid price increases occur due to options-related hedging. Deribit CEO Luuk Strijers noted that this could further intensify volatility and contribute to significant price movements as more open interest accumulates around key price points.
“With U.S. institutions and retail investors now able to trade on IBIT, we could see more options activity, creating opportunities for volatility and potentially sparking a gamma squeeze,” Strijers added.
