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November 20th, 2024

Bitcoin Bulls Take Charge: Spot Options Trading Paves the Way for Higher Gains

  • Spot Bitcoin ETF options: Options have launched for Blackrock's BTC ETF (IBIT).
  • ETF inflows: BTC ETFs are seeing increasing inflows.
  • BTC momentum: Bitcoin beat its previous ATH and keeps pushing.
  • Bitcoin ETF spot options are available to trade starting this week, and Blackrock's IBIT has seen nearly $2 billion in notional exposure on the first day alone. IBIT option trading is a welcome development as this is expected to attract significant institutional interest and inject additional liquidity into the cryptocurrency market. The added liquidity may reduce volatility while supporting upward price momentum in the months ahead.

    Bitcoin has seen a substantial increase in inflows, with $816M recorded in a single day, bringing the total to over $1 billion in just two days. In contrast, Ethereum continues to face consistent outflows, marking its fourth consecutive day of losses. This divergence further reinforces Bitcoin’s bullish momentum following its recent accumulation phase.

    Bitcoin hit a new ATH during US trading hours yesterday, topping $94,000. This confirms our thesis of an accumulation phase before a year-end breakout. If this momentum persists, Bitcoin prices could reach $120,000 before 2025, driven by growing retail interest in its robust performance and long-term potential since the US presidential election.

    With unchanged strong catalysts pushing for a strong end-of-year rally and the beginning of Bitcoin ETF options trading, we maintain a highly bullish outlook on Bitcoin. We expect Ethereum to keep lagging behind. As such, we recommend reducing exposure to Ethereum while maximizing allocations to Bitcoin to capitalize on the anticipated continuation of this rally.

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