Bitcoin options highlight BTC's potential to hit new all-time highs
Bitcoin (BTC) surpassed $101,000 on May 8, marking a three-month high with a 4.6% daily gain, leading to $205 million in liquidations of bearish futures positions. The majority of the $8.3 billion in Bitcoin put options for the next three months are below $101,000 and may expire worthless. Popular strategies on Deribit include the “bull put spread,” where traders sell a put option while buying another at a lower strike price. Sustaining the $100,000 level could benefit bullish strategies in upcoming expiries, although sellers in futures markets may resist further price increases. The open interest in Bitcoin futures is $69 billion, indicating strong demand for short positions. The Bitcoin futures premium has been below 8%, limiting incentives for the “carry trade.” A surge above $105,000 could trigger short covering, increasing the likelihood of reaching a new all-time high.
