BlackRock Bitcoin ETF Options See $1.9 Billion Traded on Launch Day

Key Takeaways:

• BlackRock’s IBIT options debuted with $1.9 billion in exposure. 
• The introduction of IBIT options is set to boost institutional Bitcoin investment and risk strategies.
• The launch of IBIT options may have fueled Bitcoin’s record-high prices and a 220% surge in Spot Bitcoin ETF inflows.

On its debut trading day, options contracts for BlackRock’s iShares Bitcoin Trust ETF (IBIT) amassed $1.9 billion in exposure, a remarkable milestone for a new offering. This substantial activity is believed to have fueled the meteoric rise of Bitcoin to a record-high price of $94,041. 

IBIT options trade interest highlights Bitcoin’s growing appeal among investors, reflecting its strong momentum and increasing importance in the financial market.

IBIT Options See Record-Breaking First Day

Bloomberg ETF analyst James Seyffart disclosed in an X post on November 19 that the final tally of IBIT options reached just under $1.9 billion in notional exposure, with 354,000 contracts traded. 

UPDATE: Final tally of $IBIT's 1st day of options is just shy of $1.9 billion in notional exposure traded via 354k contracts. 289k were Calls & 65k were Puts. That's a ratio of 4.4:1. These options were almost certainly part of the move to the new #Bitcoin all time highs today pic.twitter.com/IN3s9hajJ2

— James Seyffart (@JSeyff) November 19, 2024

The IBIT options began trading on the Nasdaq the same day, allowing investors to speculate on Bitcoin’s price by locking in the right to buy or sell ETF shares at pre-set prices. 

Notional exposure, a key metric here, reflects the market value tied to these option positions, including price changes relative to Bitcoin and the cryptocurrency’s total value controlled by contracts.

Senior Bloomberg ETF analyst Eric Balchunas responded to Seyffart, describing the IBIT options debut volume as “unheard of.” 

Related: BlackRock Head Says Bitcoin is a ‘Unique Diversifier,’ Not a ‘Risk-On’ Asset

He compared IBIT options to the ProShares Bitcoin Strategy ETF (BITO), which debuted four years ago as the first Bitcoin ETF in the U.S. BITO had an opening day notional exposure of $363 million, a fraction of what IBIT options achieved. 

$1.9b is unheard of for Day One. For context, $BITO did $363m and that's been around for four years. And also this is with 25,000 contract position limits. That said, $1.9b isn't quite big dog level yet tho, eg $GLD did $5b today, but give it a few more days/weeks. https://t.co/nAr2rracjb

— Eric Balchunas (@EricBalchunas) November 19, 2024

The put/call ratio from IBIT’s first trading day also drew attention, standing at 0.225. This indicates that call buyers, betting on Bitcoin’s price rise, significantly outnumbered those purchasing puts, which speculate on price declines. 

The enthusiasm around calls points to bullish market sentiment surrounding Bitcoin and IBIT options.

Balchunas tempered expectations by noting that while IBIT’s $1.9 billion exposure is impressive, it doesn’t yet rival larger ETFs like $GLD, which tracks gold prices and recorded $5 billion in trades on the same day. 

He emphasized that IBIT options might require more time to solidify their position as heavy hitters.

94k all day. $BTC

— The Wolf Of All Streets (@scottmelker) November 19, 2024

Furthermore, the launch appears to have influenced Bitcoin’s record-breaking rally. 

Analysts, including Seyffart, suggested that the introduction of IBIT options played a role in Bitcoin reaching an all-time high of $94,000 on November 19, as massive adoption and BTC-based trades influence the asset. 

As the market watches closely, the coming weeks will reveal whether the momentum of IBIT options is sustained.

Related: BlackRock CEO Says Bitcoin Is a Must-Have as Company Hits $10.6T AUM

IBIT Options Launch Triggers 220% Surge in Spot Bitcoin ETF Inflows

Inflows into U.S. spot Bitcoin ETFs surged by a remarkable 220% from the previous day, driven by the new momentum from the launch of IBIT options. 

According to data from SoSoValue, the 12 spot Bitcoin ETFs tracked recorded a total of $816.44 million in net inflows on November 19, representing more than double the previous day’s inflows. Among the standout performers, ARK Invest and 21Shares' ARKB ETF led the way, attracting $267.34 million. 

In addition to the already substantial movement in the Bitcoin ETF market, Grayscale, another major crypto asset manager, is set to introduce options for its own spot Bitcoin ETF on November 20. 

Grayscale is thrilled that Options trading on both $GBTC and $BTC will begin tomorrow – further developing the ecosystem around our US-listed #Bitcoin ETPs. pic.twitter.com/i7kFpOiogq

— Grayscale (@Grayscale) November 19, 2024

This launch could spark even more substantial inflows and further contribute to the positive momentum Bitcoin investment products are currently experiencing.