Bitcoin Blasts Off as Crypto Traders Strap In for Wild Ride
The world’s largest cryptocurrency is on a tear, notching fresh all-time highs above $94,000 as bullish sentiment grips the market. Leading the charge are ETF options traders who are betting big on Bitcoin’s continued ascent.
Tuesday saw the debut of options trading for BlackRock’s much-anticipated spot bitcoin ETF (IBIT). The response from traders was explosive, with most of the action centered on call options – a clear sign that many see substantial further upside ahead for BTC.
According to crypto quant researcher Samneet Chepal, some bold traders are even gambling on a doubling of IBIT’s price through purchases of $100 strike calls. “It’s pretty interesting to see ‘professionals’ degen into $100 strikes, effectively betting on BTC prices doubling,” Chepal noted.
The frenzied options activity helped propel Bitcoin to a new record peak just shy of $94,000. With additional ETF options set to start trading in the coming days, the speculative mania could have room to run.
MicroStrategy Joins Mega-Cap Club as Bitcoin Bet Pays Off
Amid the bitcoin bonanza, MicroStrategy, the enterprise software firm with the largest corporate BTC treasury, rocketed into the ranks of the top 100 US stocks by market value. MSTR shares surged to a record close above $430, far outpacing their dotcom bubble peak.
Under CEO Michael Saylor’s leadership, MicroStrategy has amassed nearly 400,000 BTC over the past several years, a stake now worth over $38 billion. The epic rally in its stock price – up 528% year-to-date – has outshined even Bitcoin itself and high-flying chip giant Nvidia.
“We are waiting on further developments if this convertible note has been oversubscribed, which would increase its issuance by $250 million, for a total of $2 billion,” CoinDesk’s James Van Straten wrote regarding MicroStrategy’s latest fundraising efforts to buy even more Bitcoin.
Robinhood Poised to Ride Crypto Regulation Tailwinds
Looking ahead, popular trading platform Robinhood could be one of the biggest beneficiaries of crypto-friendly policies expected under a Trump administration, according to broker Bernstein. In a report, Bernstein predicted Robinhood will boost revenues by listing more tokens and adding new crypto products.
The report’s authors wrote that Robinhood’s recent acquisition of European exchange Bitstamp “should further boost value added crypto services,” underpinning a 45% surge in its stock price.
Altcoin Mania Spreads as Crypto Market Sizzles
While Bitcoin leads the headlines, crypto traders’ appetite for altcoins is also growing. Trading volumes for Dogecoin and XRP exceeded those of BTC on South Korean exchanges Upbit and Bithumb, a telltale sign of broadening speculation.
Historically, a pickup in interest in alts has augured major rallies across the entire crypto space. With individual investors joining the fray alongside institutions, the stage may be set for a dramatic expansion of the overall crypto market in the months ahead.
One potential speedbump, however, is the risk-free interest rate as reflected by the US 10-year Treasury yield. This key bond benchmark is testing a major technical inflection point. A breakout to the upside would likely put pressure on risk assets, Bitcoin included.
But with a staggering $2.2 trillion balance sheet and counting, the Federal Reserve has repeatedly proven its wherewithal to backstop financial markets. That implicit put option could be enough to keep the crypto party going even in the face of rising yields.
For now, with Bitcoin notching a new high on a nearly daily basis, euphoria remains the dominant mood. How long it lasts is anyone’s guess, but one thing’s for sure – crypto traders are strapping in for an exhilarating ride.
