- Bitcoin reached a record $94,784.90 on Tuesday.
- The new all-time high coincided with the launch of BlackRock’s Bitcoin ETF options.
- Here’s why experts say the launch will drive the price to $100,000.
People can’t get enough Bitcoin exposure.
The top cryptocurrency peaked at a record $94,784.90 before sliding to about $89,696 on Tuesday.
The new all-time high comes as investment giant BlackRock launched its new Bitcoin exchange-traded fund options to the tune of almost $2 billion in notional exposure, the total amount of risk exposure for a position.
That “is unheard of for day one,” Eric Balchunas, an ETF analyst at Bloomberg Intelligence, tweeted. He compared it with ProShares’ Bitcoin ETF which did $363 million on the day and has been around for four years. “That said, $1.9b isn’t quite big dog level yet.”
The success of BlackRock’s latest product is another factor analysts say will drive Bitcoin’s price towards $100,000 and beyond.
Market watchers say several factors are driving the rally. These include the Republican sweep in the US elections, central banks cutting interest rates, and a growing demand from investors to get in on the action.
What also helped: MicroStrategy made the biggest-ever Bitcoin purchase.
What’s the deal?
Market watchers have been excited about the prospect of Bitcoin ETF options amid mounting optimism that the US Securities and Exchange Commission will greenlight them.
Why? Because they will open the floodgates for even more investors to tap into crypto assets.
Bitcoin ETF options allow investors to buy or sell Bitcoin for a specific price at a predetermined date just as easily as they purchase options for stocks — without needing to sign up on crypto-specific options platforms.
“This is a big deal,” crypto analyst Noelle Acheson wrote in her newsletter on Tuesday.
The launch of BlackRock’s latest product will ensure more market sophistication that should remove some volatility from the market, and, in turn, encourage investors to tap into it, she said.
While the derivatives markets have so far predominantly been the domain of institutional investors, the launch will also open opportunities for retail investors.
“Today is a significant step for a young asset in a huge market,” Acheson wrote.
“It’s about offering investors of all types a greater range of investment strategies. It’s about encouraging more market makers to become active in the US crypto markets. And it’s about pulling BTC even further into the ranks of ‘investable assets’ for all types of portfolios.”
Bitcoin records
Bitcoin ETF options won’t just provide investors with more avenues to invest in crypto — potentially upping the demand for Bitcoin as well — but also provide insights into where traders expect the asset’s price to go.
Bullish bets that Bitcoin’s price will go up made via BlackRock’s Bitcoin ETF options seem to back analysts’ predictions that Bitcoin is about to break the $100,000 barrier.
Joe Constori, head of growth at Theya and institutional lead at the Bitcoin Layer, noted on X that the December 20 is seeing its highest volume at the $65 mark,
That level translates to a Bitcoin price of roughly $114,000, he said.
Eric Johansson is DL News’ News Editor. Got a tip? Email at eric@dlnews.com.
UPDATE: This article was updated in the bullet and second paragraph to note Bitcoin’s new record.