Key Takeaways
- BlackRock's IBIT options traded $1.9B on their first day.
- Bitcoin surged past $94,000 amid strong demand for IBIT options.
- Grayscale plans to launch options for its Bitcoin ETF next.
BlackRock’s iShares Bitcoin Trust ETF (IBIT) options debuted on Nov. 20, recording nearly $1.9 billion in notional exposure through 354,000 contracts.
This unprecedented volume, described as “unheard of” by Bloomberg ETF analyst Eric Balchunas, dwarfs the $363 million seen during the ProShares Bitcoin Strategy ETF’s (BITO) first day.
Bitcoin hits record high
Bitcoin responded with a surge, hitting a record high of $94,105 on Nov. 19, according to TradingView data.
Analysts attribute this rally to the strong demand for IBIT options, which grant investors the right to trade ETF shares at predetermined prices.
Bullish sentiment
The put/call ratio for IBIT options was just 0.225, signaling overwhelming optimism among traders betting on Bitcoin’s price increase.
Some contracts set to expire in a month speculate on Bitcoin’s price doubling within that timeframe, according to Balchunas.
Ran Neuner, former CNBC Africa host, noted the significant market impact:
As traders buy these options, market makers buy the spot ETF to hedge the trade. The result is huge net buying in spot BTC.
Grayscale is also set to launch options for its spot Bitcoin ETF today, potentially adding to the bullish momentum.
