Bitcoin reached an all-time high today, surpassing $93,750. This surge in price comes as spot bitcoin ETF options are now available on Nasdaq, meeting strong demand from traders. The launch of options trading on spot bitcoin ETFs is expected to increase the exposure of the digital currency among financial institutions.
At the time of writing, Bitcoin was trading above $93,750, marking a more than 3% increase in the last 24 hours. This new high breaks the previous record of $93,450 set on Nov. 13. In contrast, the CoinDesk 20, which tracks the top 20 cryptocurrencies by market capitalization excluding stablecoins, memecoins, and exchange tokens, is down approximately 0.5%. Among the cryptocurrencies on the index, HBAR was the biggest winner, up 4.5%, while NEAR was the biggest loser, down 5%.
Options contracts allow investors to buy or sell an asset at a specific price and time. While the CME already offered bitcoin options, the introduction of spot bitcoin ETF options is significant for both retail participants and financial institutions. Noelle Acheson, a former head of market insights at Genesis, emphasized that a deeper onshore derivatives market will enhance market sophistication, boost investor confidence, attract new cohorts, and enable a greater variety of investment and trading strategies.
Institutions are likely to be drawn to the flexibility and high-volume exposure provided by options trading. The availability of options allows for more nuanced investment strategies and increased exposure relative to the initial investment, making them appealing to large players. Currently, only one U.S.-based spot bitcoin ETF, BlackRock’s IBIT, offers options trading, and the demand has been robust. Bloomberg ETF analyst Eric Balchunas reported that there has been a significant volume of options trading on IBIT, with the majority of contracts being calls, indicating bullish bets on Bitcoin’s future price movement.
Overall, the introduction of options trading on spot bitcoin ETFs is seen as a positive development for the cryptocurrency market, offering new opportunities for investors to participate in the growing digital asset space. As Bitcoin continues to break new highs, the availability of options trading is expected to further drive interest and participation from both retail and institutional investors.