Bitcoin’s price surged to a new high of over $94,000 after the launch of options contracts on BlackRock’s spot Bitcoin exchange-traded fund (ETF) and the iShares Bitcoin Trust ETF (IBIT). The iBIT saw almost $2 billion in total exposure traded via 354,000 contracts, according to Bloomberg ETF analyst James Seyffart. This marked a significant increase from the first Bitcoin ETF offering in the US, which saw only $363 million in exposure on its launch day.
The new options contracts give investors the right to trade shares of the ETFs at predetermined prices, allowing them to bet on price movement. The put/call ratio for IBIT’s first day of trading was 0.225, indicating that more investors were betting on Bitcoin’s price rise than fall. Analyst Eric Balchunas described this as a “very bullish” sign.
Industry experts agree that the launch of IBIT options contributed to today’s market pump. Ran Neuner, former CNBC Africa host, said that traders buying options cause market makers to buy spot ETFs, leading to huge net buying in both assets. Joe Consorti, an industry executive, described the listing of options on spot BTC ETFs as a “game-changer” for unlocking large liquidity pools.
Grayscale is also preparing to launch options for its spot Bitcoin ETFs on November 20. The successful launch of IBIT options suggests that investors are confident in Bitcoin’s price movement and expect it to end the year above $100,000.
Source: https://cointelegraph.com/news/blackrock-bitcoin-etf-options-unheard-of-day-one-volume