A recent large bitcoin options trade suggests a potential shift from the current low-volatility market to a period of heightened price swings, with the possibility of surpassing the $53,000-$87,000 range. The trade involved the purchase of 100 contracts of the $66,000 strike call and put options expiring on Nov. 29, with a net premium of over $1 million paid by the entity. This data was confirmed by Lin Chen, head of business development Asia at Deribit.
When expecting significant market movement in either direction, a long straddle strategy like this one is often preferred. This strategy involves buying both call and put options to benefit from a substantial price increase or decrease, making the options more valuable than the total premium paid. To achieve profitability and surpass the premium paid, the bitcoin price would need to move above $87,000 or below $53,000 by the end of November, according to Chen.
