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As the US presidential election nears, a record-setting $25 million Bitcoin options trade on Derive highlights growing institutional bets on a post-election Bitcoin rally.
Key Notes
A $25 million options trade on Derive has set a new record tied to the US election.The trade uses a complex multi-legged strategy aiming to profit if Bitcoin reaches $80,000 by November 29.The institution behind the trade used restaked Bitcoin (eBTC) as collateral, earning passive yields.As the United States presidential election approaches, political uncertainty is having a ripple effect on the crypto market. This week, decentralized derivatives exchange Derive noted an institution executing a record-setting $25 million options trade tied to the upcoming U.S. election.
This trade stands out not only for its size but also for its strategic complexity behind it. The institution employed a multi-legged Bitcoin options strategy, purchasing 100 call option contracts with a $70,000 strike price and selling 200 call contracts at $80,000. In addition, the institution wrote 100 contracts of a $50,000 put option, all expiring on November 29. This well-calculated positioning aims to profit most if Bitcoin BTC $67 520 24h volatility: 1.7% Market cap: $1.34 T Vol. 24h: $37.18 B rallies to $80,000 by the end of November.
The trade was secured by depositing eBTC, restaked Bitcoin created via EtherFi, as collateral. By doing so, the institution not only secures its position but also earns passive yields on its staked Bitcoin, creating a dual-benefit scenario. According to Nick Forster, co-founder of Derive, this $25 million options trade is a “watershed moment” for onchain options trading.
If Bitcoin hits the $80,000 mark by the expiration date, the institution stands to gain a remarkable $1.02 million from the options trade alone, excluding any gains from the eBTC collateral.
Institutional Interest Grows amid Market Uncertainty
The growing interest in Bitcoin derivatives trading, especially in the context of the upcoming US election, reflects the broader sentiment in the crypto market. Market participants are increasingly hedging their bets, taking calculated risks that suggest optimism in a post-election rally.
Meanwhile, the rising institutional demand is evidenced by the massive influx of capital into Bitcoin-related investment products, particularly after the launch of spot Bitcoin ETFs earlier this year.
Data from SoSoValue indicates that since their launch in January, Bitcoin ETFs have cumulatively attracted $21.34 billion in inflows. On Wednesday, these funds saw a net inflow of $192 million, illustrating the continued confidence in Bitcoin’s long-term growth potential among institutional investors.
In the short term, Bitcoin price showed volatile motion on Thursday. The crypto dipped to $65,500 earlier on the say. Nonetheless, it quickly regained ground, trading around $67,000 at the time of writing, with a total market capitalization of $1.33 trillion.
As the November 5 election draws nearer, all eyes are on Bitcoin’s potential to rally, with many analysts predicting major price movements depending on the outcome. Last month, research firm Bernstein forecasted a new high of $90,000 for BTC by the end of the year if Donald Trump wins the election.
Disclaimer: Coinspeaker is committed to providing unbiased and transparent reporting. This article aims to deliver accurate and timely information but should not be taken as financial or investment advice. Since market conditions can change rapidly, we encourage you to verify information on your own and consult with a professional before making any decisions based on this content.
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With a background in finance and a passion for innovation, Anisha has been covering the ever-evolving world of crypto for over four years. Her deep understanding of the crypto market have made her a trusted source for analysis and news. Whether it's dissecting the latest trends or decoding whitepapers, Anisha is dedicated to bringing clarity to the world of digital assets.
