High-Stakes $100K Bitcoin Call Signals Record Price Jump After Trump’s Inauguration

The cryptocurrency market is buzzing with optimism as traders position themselves for a potential Bitcoin (BTC) rally to record highs. This excitement is fueled by expectations of pro-crypto regulatory changes following President-elect Donald Trump’s inauguration on January 20.

What to Know

• Options Activity: Renewed interest in $100,000 and $120,000 Bitcoin call options on Deribit signals bullish market sentiment.
• Major Investment: A trader spent over $6 million on $100,000 strike call options expiring on March 28.
• Market Momentum: Bitcoin is recovering, currently trading near $99,500, marking an 8% rebound from its December low.

The $100,000 Bitcoin Call: A Bold Bet

On January 20, President-elect Donald Trump’s inauguration is expected to mark a turning point for the Bitcoin market. Over the weekend, a trader on Deribit, a prominent crypto options exchange, spent over $6 million on $100,000 strike call options expiring on March 28.

According to data from Amberdata, this significant trade reflects strong market confidence in Bitcoin reaching new highs within months of Trump taking office. These call options are not merely speculative but indicate a broader expectation of bullish market conditions.

A call option gives the buyer the right to purchase Bitcoin at a specific price in the future. The buyer profits if Bitcoin surpasses the strike price, making this a clear signal of market optimism.

The Popularity of $120,000 Call Options

Beyond the $100,000 strike, traders are actively buying $120,000 call options. Currently, this strike price boasts a notional open interest of $1.52 billion, making it the most popular option on Deribit.

This trend suggests that market participants believe Bitcoin’s price could soar even higher, surpassing $120,000 in the coming months.

Bitcoin’s Price Momentum

Bitcoin’s price recovery adds fuel to the bullish sentiment. As of now, BTC is trading just shy of $100,000, up 8% from its December 30 low of $91,384.

This resurgence is noteworthy, given that Bitcoin had faced selling pressure due to year-end profit-taking and hawkish Federal Reserve rate projections. The market now anticipates a rebound driven by potential bullish announcements and policy changes under the new administration.

Pro-Crypto Regulatory Expectations

The anticipation of pro-crypto regulatory changes is a key driver behind the current market sentiment. Greg Magadini, director of derivatives at Amberdata, noted:

“The inauguration and the period immediately after will likely see bullish announcements and policies that could act as catalysts for Bitcoin’s price to move higher.”

CF Benchmarks, a regulated cryptocurrency index provider, echoed these sentiments in its annual report. The firm suggested that a restructured SEC with pro-crypto leadership could reduce regulatory risks, streamline compliance, and boost investor confidence.

However, CF Benchmarks also warned that potential delays or shifts in policy implementation could temper market optimism and lead to short-term volatility.

Historical Context: Bitcoin’s Rally Since November

The bullish sentiment surrounding Bitcoin has been building since Donald Trump’s election victory in early November. BTC surged from approximately $70,000 to new lifetime highs above $108,000 in the weeks following the election.

However, the rally slowed in late December, likely due to year-end profit-taking and cautious sentiment driven by the Federal Reserve’s hawkish stance on interest rates.

What This Means for Bitcoin Investors

The current market activity underscores a growing confidence in Bitcoin’s potential to reach new heights. The $100,000 and $120,000 strike call options indicate strong expectations for a significant price rally, fueled by regulatory optimism and broader market recovery.

However, investors should remain cautious. While pro-crypto policies could act as a catalyst for further gains, uncertainties surrounding policy implementation could lead to volatility in the short term.

The Road Ahead

As the crypto market navigates this pivotal moment, all eyes are on Bitcoin’s performance following Trump’s inauguration. If the expected regulatory changes materialize, Bitcoin could enter a new phase of growth, cementing its position as the leading cryptocurrency.

With traders positioning for record price levels and optimism at an all-time high, 2024 could mark a defining year for Bitcoin.