In a recently published article, the Wall Street Journal floats the possibility of Bitcoin hitting $50,000, referring to the call options of an uber-bullish cryptocurrency trader. The crypto community is currently riding a new wave of enthusiasm after the number one coin surged to $9,000.
Raising the stakes
On May 23, an anonymous trader placed 30 Bitcoin call options on LedgerX with the strike price being set at a staggering $50,000. U.Today reminds its readers that call options (or simply ‘calls’) are derivative contracts that allow the holder to buy an asset at a specific price while setting an expiration date.
The stakes are high. If Bitcoin fails to reach the aforementioned number by June 2020, these options will be worthless. On the flip side, this trader could potentially rake in enormous profits in case BTC indeed smashes the target.
A risky bet
LedgerX co-founder Juthica Chou claims that this is the first time when call-options trades at such high prices since 2017. Back in May, they saw the $25,000 figure, but it seems like traders are ramping up their game.
When you get these bull markets, people get a little excited and they start making more and more aggressive trading decisions,” said Josiah Hernandez, chief investment officer at Satoshi Capital, a cryptocurrency trading firm.
Bitcoin is still struggling to touch $9,000 again after its most recent success was followed by a sudden pullback. Meanwhile, a TradingView expert recently explained why the ‘crypto king’ could soar up to $100,000.