Considering the performance of Bitcoin in the past weeks, it does not seem unreasonable to buy a Bitcoin purchase option with a transaction price of $ 80,000, which expired in June. When BTC dropped to $ 30k after rising to $ 42k on January 8, the investor did not expect such.
On January 26, when the BTC price was trading at $ 32,000, it had to increase 150 percent to reach $ 80,000. Therefore, buy options at $ 80,000 were traded at Deribit at $ 2,240, or 0.07 BTC, at that time.
About: What is a Bitcoin option? How do option contracts work?
In less than two months, BTC reached $ 61,700 on March 13, and the transaction price of the same option jumped to 0.15 BTC, or $ 9,255. The cryptocurrency has tripled in value in less than seven weeks. Still, in order to reach $ 80,000 despite a 93 percent rally, BTC needs to gain another 30 percent in value.
Despite the recent rise in the BTC price, the probability (delta) of these options is at 39 percent. The price of the call option has also risen due to the volatility of BTC as sellers demanded a larger premium due to their risk taking in uncertain markets.
Regardless of which direction, intense price changes increase volatility and unexpected news causes this indicator to rise.
How far the expiry date is greatly influences the pricing of options. 80 thousand dollar call options may become invalid two days before the due date. For this reason, investors should not pay too much attention to the probability of realization (delta) of options.
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