Bitcoin Options Traders Aim for $80,000 by November: Election Impact Debated
Bitcoin Options Traders Bet on $80,000 Milestone Before November Ends
As the US presidential election approaches, the crypto world is abuzz with speculation about its impact on Bitcoin’s price. With just 15 days until the election, options traders are increasingly confident about a new all-time high for Bitcoin, regardless of the winner.
Traders Favor Call Options Ahead of Election
A recent report from Bloomberg reveals that options traders are placing substantial bets on Bitcoin hitting a record high of $80,000 by the end of November. Notably, implied volatility for Bitcoin options, especially those expiring around election day, remains elevated. More traders are leaning towards call options, which grant the buyer the right to purchase BTC at a higher price.
David Lawant, head of research at crypto prime broker FalconX, commented, “The market consensus is that Bitcoin is likely to perform well regardless of the election outcome.” His analysis indicates a clear bias towards upside potential in options activity surrounding the upcoming elections.
Political Landscape: Diverse Views on Crypto
The political scene presents contrasting viewpoints on the nascent cryptocurrency landscape. Trump, a vocal advocate for digital assets in recent months, is seen by many as pro-crypto, leading to the label of Bitcoin as a “Trump trade.” On the other hand, Harris has promised to support a regulatory framework for cryptocurrencies, a shift from the stricter oversight observed during the Biden administration, marked by consistent enforcement actions and lawsuits against industry players.
Beyond Politics: Other Factors Driving Sentiment
The report highlights that, beyond political influences, traders are considering other factors, such as potential interest rate cuts by the Federal Reserve (Fed) and ongoing inflation concerns, which contribute to a generally optimistic outlook.
Data Highlights Strong Demand for $80,000 Bitcoin Calls
Data from Deribit, a crypto options exchange, shows a decreasing put-to-call ratio, indicating that more traders are buying call options than puts as the year approaches its end. Yev Feldman, co-founder of SwapGlobal, explained, “We are witnessing traders purchasing calls near $68,000 and puts near $66,000, suggesting that many are positioning for a breakout in either direction.”
Feldman added that there’s limited reason to expect a downward collapse after the election, making an upward movement seem more plausible for the leading cryptocurrency.
Open interest data also reveals that call contracts set to expire on November 29 are concentrated around the $80,000 mark, with the second most popular strike price at $70,000. For contracts expiring on December 27, interest clusters around $100,000 and $80,000, while the most sought-after strike price for calls expiring on November 8 is $75,000.
It’s notable that call options are commanding higher premiums compared to 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 elaborated.
Lawant also highlighted that opinions on non-Bitcoin cryptocurrencies remain varied, with less consensus on how these assets might fare under different electoral scenarios. At the time of writing, BTC was trading at $67,370.
Featured image from DALL-E, chart from TradingView.com