Kaiko: ETF options are the latest bullish signal for BTC

Kaiko released a report saying that ETF options are the latest bullish signal for BTC. Multiple BTC ETF options made their debut last week, with BlackRock's IBIT options reaching $1.90 billion in nominal volume on day one for a total of 354,000 contracts. In comparison, BITO options were trading at $360 million when they launched in 2021. This strong buying power highlights strong demand for BTC-linked derivatives and bullish market sentiment.
Notably, more than 80% of IBIT's first-day options volume was call options, reflecting the market's strong belief in the rise in bitcoin's price. Trading activity was largely focused on options that expired recently, with contracts expiring in December 2024 dominating. IBIT's share of call options significantly surpassed Deribit, the largest crypto-native options market, where call options accounted for 64% of transactions.
The launch of options on BTC spot ETFs could further accelerate institutional adoption. These tools allow investors to hedge risk and develop sophisticated strategies to profit from Bitcoin's volatility. In addition, they could also drive the birth of structured products, customized investments that offer specific risk-reward characteristics, often developed by large Financial Institution Groups. This could attract new capital and a new wave of experienced institutional traders.