As President-elect Donald Trump is set to officially take office on January 20, the cryptocurrency market is enveloped in a strong atmosphere of optimism. Traders are betting that after Trump takes office, Bitcoin is expected to reach new highs, and market sentiment is unprecedentedly enthusiastic.
Amberdata data shows that over the weekend, a trader spent more than $6 million on the Deribit cryptocurrency exchange to buy call options with a strike price of $100,000, expiring on March 28.
Amberdata posted on social media platform X: "This transaction reflects the market's expectation that Bitcoin will continuously break historical records in the months following Trump's inauguration."
Moreover, traders' demand for call options with a strike price of $120,000 is also soaring, currently becoming the most popular option on the Deribit platform, with an open interest nominal value of up to $1.52 billion, reflecting market expectations for Bitcoin's future performance.
Call options grant buyers the right to purchase assets at a specified price in the future, allowing them to achieve highly attractive returns when the market rises. Recently, demand for call options on Bitcoin has surged, indicating that investors are positioning themselves ahead of potential price spikes.
As of the time of writing, the trading price of Bitcoin is $99,050, having rebounded over 8% from the low of $91,384 on December 30.
Can policy dividends ignite the Bitcoin market?
Greg Magadini, the director of Amberdata's derivatives department, stated: "The day of Trump's inauguration and the subsequent days are expected to be a golden period for announcing significant favorable policies, which could become important catalysts for Bitcoin's rise."
CF Benchmarks, a cryptocurrency index provider, also agrees with this view and further points out that the crypto-friendly Paul Atkins will succeed the chairmanship of the SEC, which is expected to reduce enforcement risks, promote innovation, and enhance investor confidence.
CF Benchmarks stated: "We expect a regulatory framework for the cryptocurrency industry to be imperative, but delays or changes in policy direction could weaken market optimism in the short term and lead to volatile market conditions."
Since Trump's victory in November last year, market expectations for friendly regulatory policies have significantly increased, and the price of Bitcoin has surged from $70,000 to an all-time high of $108,000.
However, this wave of rising momentum showed signs of fatigue by the end of December, possibly influenced by year-end profit-taking selling pressure and hawkish interest rate hike expectations from the Federal Reserve.
"Options bets 'Bitcoin will surge to $120,000'! Investors are optimistic that 'Trump's inauguration' will spark a celebratory market." This article was first published on (Blockkey).
