Bitcoin Options Traders Set Sights On $80,000 By November-End, Regardless Of US Election Outcome

As the US presidential election approaches, the crypto community is buzzing with speculation regarding how the outcome will affect the Bitcoin price. With just 15 days until the election between former President Donald Trump and Vice President Kamala Harris, options traders are increasingly optimistic about a new all-time high for Bitcoin, regardless of who wins the presidency. Traders Favor Call Options Ahead Of US Election According to a recent report from Bloomberg, options traders are placing significant bets that Bitcoin will reach a record high of $80,000 by the end of November. Notably, implied volatility for Bitcoin options, particularly those expiring around the election day, remains elevated. More traders are favoring call options, which give the buyer the right to buy BTC at new highs. Related Reading: Ethereum Bullish Breakout Confirmed – Top Analyst Predicts $3,400 Target David Lawant, head of research at crypto prime broker FalconX, commented, “I believe the market consensus is that Bitcoin is likely to perform well regardless of the election outcome.” His analysis indicates that options activity surrounding the upcoming elections shows a distinct bias toward upside potential. The political landscape features contrasting views regarding the nascent cryptocurrency landscape. Trump, who has been a vocal advocate for digital assets over the past months, is viewed by many as a pro-crypto candidate, leading to the characterization of Bitcoin as a “Trump trade.” On the other hand, Harris has pledged to support a regulatory framework for cryptocurrencies, a shift from the more stringent oversight seen during the Biden administration, characterized by continuous enforcement actions and lawsuits against key players of the sector. Per the report, in addition to political factors, traders are also considering non-political influences such as potential rate cuts by the Federal Reserve (Fed) and ongoing inflation concerns, which contribute to a generally optimistic sentiment. Data Reveals Strong Demand For $80,000 Bitcoin Calls Data from Deribit, a crypto options exchange, reveals a declining put-to-call ratio, indicating that more traders are buying call options than puts as the year draws to a close. Yev Feldman, co-founder of SwapGlobal, elaborated on the current trading patterns seen among investors, stating: “We are seeing traders buying calls near $68,000 and puts near $66,000, suggesting that many are positioning for a breakout in either direction.” Feldman further added that there’s limited reason to expect a downward collapse post-election, making upward movement seem more plausible for the leading crypto of the market. Related Reading: Solana Eyes New All-Time High Of $370 After Cup And Handle Breakout Open interest data also shows that call contracts set to expire on November 29 are heavily concentrated around the $80,000 mark, with the second most popular strike price at $70,000. For contracts expiring on December 27, interest is clustered around $100,000 and $80,000, while the most sought-after strike price for calls expiring on November 8 is $75,000. Interestingly, call options are commanding higher premiums than their put counterparts, according to the skew term structure, which reflects pricing dynamics between these options. “This indicates that investors are leveraging the options market more as a tool for capturing potential upside rather than as a hedge against downside risks,” Lawant explained. The researcher also pointed out that opinions on non-Bitcoin cryptocurrencies remain divided, with less consensus on how these assets might perform under varying electoral scenarios. At the time of writing, BTC was trading at $67,370. Featured image from DALL-E, chart from TradingView.com

Oct 23, 2024 - 05:00

Bitcoin Options Traders Set Sights On $80,000 By November-End, Regardless Of US Election Outcome

As the US presidential election approaches, the crypto community is buzzing with speculation regarding how the outcome will affect the Bitcoin price.

With just 15 days until the election between former President Donald Trump and Vice President Kamala Harris, options traders are increasingly optimistic about a new all-time high for Bitcoin, regardless of who wins the presidency.

Traders Favor Call Options Ahead Of US Election

According to a recent report from Bloomberg, options traders are placing significant bets that Bitcoin will reach a record high of $80,000 by the end of November.

Notably, implied volatility for Bitcoin options, particularly those expiring around the election day, remains elevated. More traders are favoring call options, which give the buyer the right to buy BTC at new highs.

David Lawant, head of research at crypto prime broker FalconX, commented, “I believe the market consensus is that Bitcoin is likely to perform well regardless of the election outcome.” His analysis indicates that options activity surrounding the upcoming elections shows a distinct bias toward upside potential.

The political landscape features contrasting views regarding the nascent cryptocurrency landscape. Trump, who has been a vocal advocate for digital assets over the past months, is viewed by many as a pro-crypto candidate, leading to the characterization of Bitcoin as a “Trump trade.”

On the other hand, Harris has pledged to support a regulatory framework for cryptocurrencies, a shift from the more stringent oversight seen during the Biden administration, characterized by continuous enforcement actions and lawsuits against key players of the sector.

Per the report, in addition to political factors, traders are also considering non-political influences such as potential rate cuts by the Federal Reserve (Fed) and ongoing inflation concerns, which contribute to a generally optimistic sentiment.

Data Reveals Strong Demand For $80,000 Bitcoin Calls

Data from Deribit, a crypto options exchange, reveals a declining put-to-call ratio, indicating that more traders are buying call options than puts as the year draws to a close.

Yev Feldman, co-founder of SwapGlobal, elaborated on the current trading patterns seen among investors, stating: “We are seeing traders buying calls near $68,000 and puts near $66,000, suggesting that many are positioning for a breakout in either direction.”

Feldman further added that there’s limited reason to expect a downward collapse post-election, making upward movement seem more plausible for the leading crypto of the market.

Open interest data also shows that call contracts set to expire on November 29 are heavily concentrated around the $80,000 mark, with the second most popular strike price at $70,000.

For contracts expiring on December 27, interest is clustered around $100,000 and $80,000, while the most sought-after strike price for calls expiring on November 8 is $75,000.

Interestingly, call options are commanding higher premiums than their put counterparts, according to the skew term structure, which reflects pricing dynamics between these options.

“This indicates that investors are leveraging the options market more as a tool for capturing potential upside rather than as a hedge against downside risks,” Lawant explained.

The researcher also pointed out that opinions on non-Bitcoin cryptocurrencies remain divided, with less consensus on how these assets might perform under varying electoral scenarios. Bitcoin