Unchained

Why Bitcoin ETF Options Could Unlock Massive Amounts of Capital for Crypto - Ep. 711

Sep 27, 2024
Joshua Lim, co-founder and CEO of Arbelos Markets, joins the conversation to unpack the potential impact of Bitcoin ETF options on the crypto landscape. He discusses how these options could unlock significant capital and perhaps fuel an altcoin boom. Joshua explores the implications for Bitcoin volatility and DeFi lending, along with the expected changes in the options markets. Additionally, he speculates on how the upcoming U.S. presidential election might influence Bitcoin's trajectory, shedding light on strategic market dynamics.
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INSIGHT

Options: Asymmetric Financial Instruments

  • Options are asymmetric financial instruments, giving the owner the right but not the obligation to buy or sell an asset.
  • This asymmetry allows for leveraged exposure and yield generation.
INSIGHT

Bitcoin Price Impact: Two Perspectives

  • Some predict a "gamma squeeze" like GameStop, with retail investors using short-dated options to drive up Bitcoin's price.
  • Others argue that the existing mature options market and the lack of a gamma squeeze with BITO options suggest otherwise.
INSIGHT

Market Dynamics and Volatility

  • The launch of IBIT options may lead to increased issuance of structured products, potentially lowering Bitcoin volatility.
  • It could also compress the spread between Bitcoin and its proxy equities like Coinbase and MicroStrategy.
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