BlackRock Bitcoin ETF options see $1.9B on debut day

Options on BlackRock’s spot Bitcoin (CRYPTO:BTC) ETF, the iShares Bitcoin Trust ETF (IBIT), experienced a notable debut, trading nearly $1.9 billion in notional exposure.

This substantial activity coincided with Bitcoin’s surge to a new all-time high of $94,105 on Coinbase on November 19.

Bloomberg ETF analyst James Seyffart highlighted that the first day of trading included 354,000 contracts, describing the volume as significant.

“These options were almost certainly part of the move to the new Bitcoin all-time highs today,” He noted.

Senior ETF analyst Eric Balchunas commented on the impressive volume, stating, “$1.9 billion is unheard of for day one,” comparing it to the debut of the ProShares Bitcoin Strategy ETF (BITO), which traded $363 million.

Options contracts provide investors with the right to trade ETF shares at set prices, allowing bets on price movements.

The initial put/call ratio for IBIT was 0.225, indicating that calls—speculative contracts anticipating a price rise—far exceeded puts, which are contracts betting on price declines.

Balchunas noted the optimistic sentiment surrounding contracts expiring in a month, which reflect confidence in Bitcoin’s potential to double in value over that period.

Former CNBC Africa host Ran Neuner agreed, explaining that as traders purchase options, market makers hedge by buying the spot ETF, leading to increased spot Bitcoin buying.

Joe Consorti, an industry executive, emphasised the significance of listing options on spot Bitcoin ETFs, saying it “opens the doors to the largest and deepest liquidity pools on the planet.”

“The market is bullish that Bitcoin’s price ends the year well over $100k,” he added.

Grayscale, a prominent crypto asset manager, plans to follow with the launch of its own spot Bitcoin ETF options on November 20 in the U.S., indicating a growing interest in Bitcoin-linked financial products.

At the time of reporting, the Bitcoin (BTC) price was $92,594.16.