The Bitcoin Prix Rally (BTC) may have recently been dead, but the upward conviction certainly did not do it, because the whales continue to bet millions on an extensive market rally.
Recently, such a whale has executed a major optimistic options targeting $ 200,000 by the end of the year. The strategy concerned the simultaneous purchase of 3,500 contracts of the call option of $ 140,000 of $ 140,000 in December and the uncovered (or writing) of 3,500 contracts of the call option of $ 200,000 in December.
This complex trade, a bull propagation, led to an initial net rate of $ 23.7 million. As Deribit Insights noted, “the propagation of the call from 140 to 200 km dominated, the purchase of low December 140K IV, funded by higher calls IV 200K.”
The strategy will make maximum profit if BTC is regulated at the exercise price or more than $ 200,000 in this case, on the expiration date.
This strategy generates a net flow because the premium paid for the lower strike option (purchase) exceeds the premium received from the sale of the higher strike call. The gap offers limited gains for a limited risk, capping up to $ 200,000 while ensuring that the maximum potential loss is contained in the initial flow.
Options are derivatives used for speculation or cover compared to price movements. A purchase option gives the buyer the right, but not the obligation, to buy the underlying assets at a predetermined price no later than a specified future date. A call buyer is implicitly optimistic on the market, while a downside buyer is lower.
The punctual Bitcoin price reached a record summit of more than $ 123,000 on July 14 and has since consolidated in a narrow range between $ 116,000 and $ 120,000.
Save the activity of options
The BTC price rally and the growing institutional interest in structured products, which involve the sale of volatility, have stimulated activity on the options market.
On Deribit, which represents more than 80% of the activity of the global options, the open interest of BTC options, or the number of open options contracts, was 372,490 BTC from writing – a little less from the record summit of 377,892 established in June.
Meanwhile, the interest opened in Ether’s options reached a record summit of 2,851,577 ETH, according to the amberdata data source. On Deribit, an option contract represents a BTC or ETH.
