"Don't underestimate the ripple effect of what you do. These tiny ripples can become a tsunami." – Unknown
BlackRock’s IBIT Spot Bitcoin ETF became the first Bitcoin ETF to have options tied to it. Okay cool, right? Well this is much more significant than you might think. The derivatives market is the LARGEST market in the world, totaling nearly $1 QUADRILLION dollars.
For reference, likes dive in on how big some of the other markets around the globe are:
Professional sports teams are worth ~$340 billion
Cryptocurrency (gross I know but is majority Bitcoin) is at ~$760 billion
The World’s Gold is valued at $11.5 trillion
Central Bank balance sheets valued at $28 trillion
Global Debt is valued at $300 trillion
Household wealth at $463 trillion
Notional value of derivatives is between $600 trillion and $1 quadrillion
Another great reference point is the difference from 1 million seconds (1 day 13 hours 46 minutes and 40 seconds) to 1 trillion seconds (31,668 years) to 1 quadrillion (31.7 million years).
This amount of capital moving into Bitcoin is MONUMENTAL. The IBIT BlackRock Bitcoin Spot ETF launched first, then everyone else followed shortly after. The opening was historic as IBIT options surpassed $2 billion in notional exposure, had 25k contracts as a position limit, and had an anticipated 400k option contracts per day.
How bullish are options traders?
TLDR: extremely bullish.
In the first day of trading, the IBIT options had the highest volume in $65 strike calls expiring on December 20, 2024 which would reflect a Bitcoin price of $114,339. There were also 4 calls for every put meaning 4 times the people were wanting to buy options contracts of the Bitcoin price rising opposed to sell with the price lowering. A lot of these options are even calling for the Bitcoin price to double by December 20th.
With this volume, the IBIT ETF was in the top 1% of options traded on its opening day only behind the QQQ and SPY, which historically are the top daily options traded. This is EXTREMELY bullish to close out the year. November historically has a phenomenal month in positive years for Bitcoin and it is continuing the trend. Don’t believe me? See for yourself.
All this to say, $100k before the end of the year is looking all too likely. So let’s hope that occurs by the time this is published.
