Options contracts on BlackRock’s iShares Bitcoin Trust ETF (IBIT) saw nearly $2 billion in total exposure traded on the first day, pushing Bitcoin to a new all-time high of over $94,000.
Bloomberg ETF analyst James Seyffart reported that the first day of IBIT options trading saw a remarkable $1.9 billion in notional exposure across 354,000 contracts.
“These options were almost certainly part of the move to the new Bitcoin all-time highs today,” Seyffart commented on November 20.
UPDATE: Final tally of $IBIT's 1st day of options is just shy of $1.9 billion in notional exposure traded via 354k contracts. 289k were Calls & 65k were Puts. That's a ratio of 4.4:1. These options were almost certainly part of the move to the new #Bitcoin all time highs today pic.twitter.com/IN3s9hajJ2
— James Seyffart (@JSeyff) November 19, 2024
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Unprecedented Volume for a Bitcoin ETF
The volume of trades is unprecedented for a Bitcoin-related ETF. Bloomberg’s senior ETF analyst Eric Balchunas noted that the $1.9 billion traded significantly outpaced the ProShares Bitcoin Strategy ETF (BITO), which debuted with $363 million in trades.
“A few hundred million so far in options volume on IBIT (a ton for Day One). Here’s a rank of the contracts by volume, it’s almost all calls. Seems very bullish, especially the December 20 C100, which is basically betting price of BTC will double in the next month,” said Balchunas.
The new options allow investors to speculate on price movements by providing the right to trade ETF shares at predetermined prices.
The milestone also fueled a surge in inflows into U.S. spot Bitcoin ETFs. On November 19, net inflows jumped 220% from the previous day, with 12 Bitcoin ETFs recording $816.44 million in net inflows.
Among the leaders was ARK and 21Shares’ ARKB, which recorded $267.34 million, its largest single-day inflow since launch. Fidelity’s FBTC and BlackRock’s IBIT also saw substantial inflows of $256.15 million and $216.12 million, respectively.
The heightened interest extended to other funds, including Bitwise’s BITB, Grayscale’s GBTC, and VanEck’s HODL, which together contributed millions more.
Total trading volume across Bitcoin ETFs climbed to $4.78 billion, compared to $3.62 billion the previous day, underscoring the market’s growing appetite for Bitcoin exposure.
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Grayscale to Launch Options on its Bitcoin ETFs
Grayscale Investments is also set to introduce options trading on its spot Bitcoin ETFs starting Wednesday.
Grayscale announced that options trading will be available for its GBTC (Grayscale Bitcoin Trust) and BTC (Bitcoin Mini Trust) to “further develop the ecosystem” surrounding its U.S.-listed Bitcoin ETPs.
Grayscale is thrilled that Options trading on both $GBTC and $BTC will begin tomorrow – further developing the ecosystem around our US-listed #Bitcoin ETPs. pic.twitter.com/i7kFpOiogq
— Grayscale (@Grayscale) November 19, 2024
Last month, Grayscale submitted a proposal to the US Securities and Exchange Commission (SEC) to convert its $520 million Digital Large Cap Fund into an ETF.
Grayscale’s Digital Large Cap Fund currently manages over $524 million in assets, with a significant 76% allocation to Bitcoin, followed by 18% to Ethereum. The remaining portion of the fund includes assets like Solana, XRP, and Avalanche, reflecting the diversified nature of the investment.
In a related disclosure, Grayscale filed an 8-K form to inform investors about the proposed changes and their potential impact. The shift from a traditional fund to a spot ETF structure means the fund would directly hold the underlying cryptocurrencies.
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