U.S. Elections-Linked Bitcoin Options Draw Nearly $350M in Open ...

Title: U.S. Elections-Linked Bitcoin Options Draw Almost $350M in Open Interest

In anticipation of the upcoming U.S. elections, traders have locked millions of dollars in bitcoin (BTC) options tied to the event, according to data from Amberdata. The so-called election expiry options, due for settlement four days after the Nov. 4 elections, began trading on Deribit a month ago. As of writing, the notional open interest or the dollar value of the number of active options contracts was $345.83 million.

Call options, which offer an unlimited upside payoff potential at the expense of limited loss, accounted for 67% of the total open interest. The rest came from put options, which offer protection against price drops, amounting to a put-call ratio of less than 0.50. In other words, twice as many calls were open as puts, reflecting bullish expectations from the outcome of the elections.

"These election-dedicated contracts allow investors to capitalize on the increased interest by speculating on how the election will impact bitcoin prices," said an analysis by CoinDesk. The concentration of call options' open interest at strikes around $80K and $100K suggests that market participants are positioning for potential upside in bitcoin, while the presence of puts at lower strike price of $45,000 indicates some level of hedging or downside protection.