Bitcoin futures are still in their infancy on the Cboe Futures Exchange and CME, but that is not stopping some traders from making large bets on the high-flying cryptocurrency.
Data from digital currency-trading platform LedgerX show some traders are making large bets on bitcoin call options expiring in December 2018.
“Online records from New York-based digital currency-trading platform LedgerX showed 275 call options expiring Dec. 28, 2018, were bought in Wednesday’s trading session at a volume-weighted average price of $3,600. At that price, roughly $1 million was spent on the bet,” reports CNBC. “The trade gives the investor or investors the option to buy bitcoin at $50,000 in the roughly next 12 months, implying expectations that the digital currency will soar beyond that price. An investor would lose the bet if bitcoin doesn’t reach $50,000 in that time period, but would reap profits if it climbs well above that level.”
Just over a week ago, bitcoin futures debuted on the Cboe, prompting a wave of filings from ETF issuers. To date, bitcoin ETFs have not been approved by U.S. regulators. Several ETF issuers filed plans earlier this year for such products, but the plans were scrapped because, at the time of those filings, there was not a bitcoin futures market.
Earlier this week, it was revealed that Direxion and Reality Shares filed plans with the Securities and Exchange Commission (SEC) to list bitcoin ETFs.