Cryptocurrencies

[james22]

BlackRock Reveals It’s Quietly Preparing For A $35 Trillion Federal Reserve Dollar Crisis With Bitcoin - Predicted To Spark A Sudden Price Boom

 

https://archive.ph/Ld3Pk#selection-1967.0-1967.141

[TwoCitiesCapital]

5 hours ago, james22 said:

 

 

This is huge - especially since BITO has this weird "we're gonna pay a 5% monthly dividend that is totally unsupported by underlying performance of roll yield" strategy that has totally f*cked up my puts and calls on the name over the last 2-3 months despite being roughly correct on Bitcoin timing/price. 

 

Will be nice to trade options on a strategy that ACTUALLY tracks Bitcoin. 

Edited yesterday at 04:08 AM by TwoCitiesCapital

[james22]

 

[james22]

 

[Paarslaars]

Ignoring the volatility it will bring to an already volatile asset class, I'm assuming the only 'good' thing for BTC holders here would be that traders will cover their positions and need to buy ETFs for that which will increase BTC value?

[SharperDingaan]

2 hours ago, Paarslaars said:

Ignoring the volatility it will bring to an already volatile asset class, I'm assuming the only 'good' thing for BTC holders here would be that traders will cover their positions and need to buy ETFs for that which will increase BTC value?

 

The BTC-ETF just gets sold off, and the proceeds put into the BTC-ETF options; temporarily pressures BTC down as the BTC-ETF sells off some of its now too large a holding of BTC.

 

Most people are not going to be using these for risk management purposes; longer term they will be used to increase holdings in BTC-ETF, which will push up the demand for BTC.

 

SD 

[TwoCitiesCapital]

3 hours ago, Paarslaars said:

Ignoring the volatility it will bring to an already volatile asset class, I'm assuming the only 'good' thing for BTC holders here would be that traders will cover their positions and need to buy ETFs for that which will increase BTC value?

 

I think it's good for a lot of things

 

1) It allows long-term holders to derive an income off an asset that doesn't generate any via covered calls

2) It allows you to hedge positions without selling the underlying if you wanted to do puts

3) It allows an entirely new investors to enter the asset class - those seeking volatility premium

 

Previously, we only had very bad proxies in the US to trade options on.

 

As someone that has traded options on those proxies, more than 1/2 of my profits were wiped out by things like BITO announcing exceptionally large dividends unsupported by roll yield or by MARA's downdraft from $21 to $15 when I was trying to avoid selling puts across BITO's ex-dividend date....