Institutional traders are wagering on Bitcoin’s rise to $75,000 and above, according to data from the options market.
“Last Monday, the OTC market traded in accord with a bullish call-spread approach with hits on $75,000 and $100,000 and termination date on May 28,” stated analytical platform Laevitas. “These might be institutions that are wagering on Bitcoin rising up to at least $75,000 by the beginning of June.”
The so-called bullish call-spread strategy entails purchasing and market call options with one expiration date. Simultaneously, the contracts that are being sold must hold a higher execution price. For example, if last Monday, the trader who bought 100 call contracts with termination on May 28 and a strike of $75,000, has also sold 100 of these contracts with a strike of $100,000. Bitcoin at that time was trading at around $48,721.
“The aim of the call-spread bets is to take a bullish stance while meanwhile cutting costs,” clarified Laevitas.
The data shows that institutions were not scared by the recent dip in the cost of Bitcoin. Meanwhile, strategist Joel Kruger says that the rollback might not be finished just yet.
“We think that the major risk for Bitcoin in the shorter term currently is associated with the decrease in the US and global stock markets. Vulnerability is still around, so it is worth being cautious with theories about the overcoming of the low,” he noted.
We remind that before the skyrocketing of the BTC rate in the last months, the Bitcoin options market suggested that investors were preparing for the record price.
