Bitcoin surged to a fresh high above $94,000 on Wednesday after BlackRock’s iShares Bitcoin Trust (IBIT) made history as the first spot Bitcoin ETF approved for options trading.
Nasdaq launched options trading for the IBIT ETF on Tuesday, recording nearly $1.9b in notional exposure, according to Bloomberg Intelligence ETF analyst James Seyffart.
Bitcoin reached a new high of $94,000 on Tuesday after BlackRock’s iShares Bitcoin Trust made history by becoming the first Bitcoin ETF to be approved for option trading.
Bloomberg Intelligence ETF Analyst James Seyffart said that Nasdaq started options trading on the IBIT ETF Tuesday. The ETF had a notional exposure of nearly $1.9b, according to Seyffart.
Seyffart stated in an X message that the final tally for $IBIT 1st Day of Options is just short of $1.9 Billion in Notional Exposure traded through 354k Contracts.
He said that the majority of these options were Calls, with a total value of 289,000. These are bets on the price of Bitcoin increasing. Only 65,000 Put options, which represent bets on a price decrease, were traded. For every Put, four Calls are purchased.
The analyst said that “these options were almost certain to be part of the movement towards the new Bitcoin highs today.”
Bitcoin ETF options offer new opportunities for traders as volatility persists.
These options enable traders to buy and sell Bitcoin ETF shares at predetermined prices. These options provide investors with new ways to manage risks and take advantage of Bitcoin’s price fluctuations. The launch of these products is expected to boost the crypto market.
Traders use Bitcoin ETFs for a variety of reasons. A key benefit is the ability for existing Bitcoin investments to be hedged, protecting them from unfavourable changes in price. This is particularly useful due to Bitcoin’s volatility, which can result in rapid price changes within short timeframes.
Bitwise and Grayscale will launch their Bitcoin ETFs on Wednesday. Other firms are expected to follow soon.
BlackRock IBIT Starts with $1.9B but Still Lags Behind $GLD and Other Big Players.
Eric Balchunas is a senior ETF Analyst at Bloomberg . He highlighted the fact that IBIT’s notional exposure was $1.9b for its debut, which was extremely high.
He said that $BITO has managed $363m for the past four years. “That said $1.9b isn’t quite big-dog level yet, eg. $GLD did $4b today. But give it a couple more days/weeks,” said he, pointing out the SPDR gold shares ETF.
Bitcoin was trading at $91,997 last time we went to press, up nearly 30% from the election.
