Chances Are Only 4%, Options Market Signals While many analysts are predicting a bitcoin (BTC) bull run, the options market sees a very low probability of the cryptocurrency hitting a new record. Dec 21, · At the time of publication, bitcoin is trading between $18, to $19, per unit, with a market cap of over $ billion, as the leading crypto is still treading the waters on the all-time highs. BTC Markets Review. A trading cryptocurrency guide must provide reviews of all of the top crypto exchanges out there, so that you can find the best cryptocurrency exchange site for you. This review of BTC Markets consists of four parts: general information, fees, .
Call btc marketsPrices | BTC Markets
For example, rather than buying Bitcoin for its spot price, you can instead by 1 Bitcoin option contract, which allows you to profit from the difference in the strike price vs spot price of BTC.
Unlike some other derivatives, when buying a Bitcoin option, the maximum you can lose is the cost of the option premium. This means that no matter how far out of the money you go, you can never lose more than what you paid for the option.
Because of this, with Bitcoin options, you never run the risk of getting into debt or entering a deficit on your chosen trading platform. As previously mentioned, options contracts come in two main varieties — calls and puts. By buying a put option in a declining market you will be able to essentially short BTC, earning a potentially chunky profit if BTC falls below the strike price.
With Bitcoin binary options, this is reduced to a simple prediction whether Bitcoin will fall to a lower value than its current price.
If you are correct, you win a specific payout amount, while risking only the cost of your option premium. As with any investment, hedging your risks is always a good idea. With Bitcoin options, this is particularly useful when you already own Bitcoin at the spot price. Buying put positions can allow you to cheaply hedge against a declining market, protecting you from any sudden volatility or crashes. In addition, since options contracts are typically low cost, relative to the underlying asset price, they remain one of the most cost-effective ways of hedging against your existing investments.
As such, hedging with options is one of the most common strategies used by experienced investors. Although Bitcoin options can provide excellent investment opportunities, they also come with a unique set of risks and drawbacks, that may make them unsuitable for some investors. This is particularly true when using options for speculative purposes, rather than using them to reduce or eliminate your risks in another position.
With that in mind, here are some of the most common pitfalls to watch out for when trading options. This means if your Bitcoin option expires out of the money, you will lose your entire initial investment known as the option premium. If you purchased a large number of contracts, this can be a considerable loss. This is particularly important when investing in significantly out of the money options, which, while potentially highly profitable, are very likely to expire worthlessly. For most exchange platforms, a per contract fee is charged when buying options.
This fee is usually a small fraction of the underlying asset value or can be a fixed fee for certain options. Beyond this, many Bitcoin options platforms also charge an additional settlement fee, which tends to range between 0. However, since these are charged on underlying asset value, rather than your profit, these fees can consume a significant chunk of your profits.
Because the Bitcoin options space is still relatively small and has only a few well-known exchange platforms, there can be liquidity issues. Unlike standard spot trading exchanges, Bitcoin options exchanges tend to suffer from low daily trade volume and poor liquidity. This is especially true for high-value options, with only certain expiries and strikes having sufficient liquidity. This poor liquidity can lead to slippage when opening or closing a position, with the option being traded at a rate lower than expected due to a delayed match.
As a concept, Bitcoin options trading can be relatively difficult to grasp, particularly for new traders due to the technical vocabulary that is often used to describe it. Because of this, if you intended to get involved in options trading, or just want to brush up on your investment jargon, then these are the key terms you will want to understand.
If you are bullish on the price of Bitcoin, then you would consider opening a call option, as this will allow you to buy BTC at the strike price, even if the market value is higher.
In essence, Bitcoin call options allow you to speculate on the future growth of Bitcoin. You could then go on to sell this 1 BTC at a profit. If you are looking to short Bitcoin, and believe that its price will go down over the option contract term, then you would want to open a put contract. This will essentially allow you to sell Bitcoin at the strike price, even if the market value is much lower. After buying a put option, the more BTC goes down before expiry, the more your option is worth.
One of the most important terms to consider when purchasing a Bitcoin option is its strike price. In short, the strike price is the price a Bitcoin option holder can buy call option , or sell put option an underlying asset when the option is exercised.
This is the last date by which the option must be exercised before automatically expiring. After the maturity date, the seller will no longer have any obligation to the buyer, and the buyer will be unable to exercise his or her option. Typically options will have a fixed expiration date, this might be 1 day, 1 week or any length of time. While many analysts are predicting a bitcoin BTC bull run, the options market sees a very low probability of the cryptocurrency hitting a new record high by December.
In fact, the odds of prices moving into five digits by the end of December are also quite low, options market levels indicate. Options are derivative contracts that give buyers a right, but not the obligation, to buy or sell the underlying asset at a specific price known as the strike price on or before the specified date. A call option gives the buyer the right to buy, while the purchaser of the put option has the right to sell. Many analysts are confident the various monetary and fiscal measures recently announced by central banks and governments across the globe to counter the coronavirus-led downturn would bode well for bitcoin.
The amount of fiscal stimulus announced by 22 countries over the last two weeks or so is equivalent to 75 percent of the global gross domestic product GDP , according to JPMorgan. Meanwhile, central banks from New Zealand to Canada have slashed rates to zero. The U. What this broker does offer is a web-based trading platform that doubles up as the client dashboard. This software does have a couple of trading tools such as pending orders, price alerts and live news, but this would only satisfy the most novice of traders.
This broker does not clearly state what the trading conditions are. Now this is where the confusion starts. So we are not clear which currency applies to minimum deposit amounts. Furthermore, as we already have stated, this broker has not provided any information on the trading conditions.
We were only able to find out about the spreads after we registered for an account with BTC Markets. Not only are the minimum deposit information and trading conditions vague, but the payment gateways offered by BTC Markets are also suspect. This broker offers its clients the following payment options: Xpate, Vload Voucher and an unknown Cryptocurrency wallet. These payment options are suspect because we have seen them being used most by scam brokers.
In fact, many of the scam companies use Vload as their main — or only — payment gateway. Since this broker targets European customers, the fact that it offers trading bonuses makes it clear that it is a scammer. This is because brokers are banned from offering trading bonuses since they come attached with very unfair conditions. And sure enough, BTC Markets too offers bonuses with unfair trading conditions.
You will not be allowed to withdraw your funds until you have reached a trading turnover of 30 times your original deposit plus the bonus given by the broker. This kind a target is almost impossible to meet, which means that you will end up not being able to withdraw your funds at all.
BTC Markets also has indemnification clauses put in place.