3 smart ways to bet on the upcoming Bitcoin halvening with options
For example, if you hold 1 BTC you bought at $7,000 and is afraid of the halvening price volatility, you can buy a put option priced at $200 to protect your position against a possible crash.
If BTC nosedived, your maximum loss will be capped at $200. Here’s how it works.
If BTC dipped to $6,000 on Settlement Date, you will lose $1,000 value from your BTC. However, your put option will have an intrinsic value of $1,000 and can be sold for that amount thus offsetting potential losses and limiting your loss to your Premium Payable.
3. Think the halvening will be a non-event? Make your crypto assets work for you anyway.
If you don’t know where BTC will be heading with the halvening, you still shouldn’t miss out on the price action and make your assets work for you!
Don’t just HODL. If you think movements will mainly be one-sided, sideways or range bound, you can sell options to earn income from the premium received and monetize your assets.
Here’s a scenario.
If you hold 1 BTC at $7,000 and is neutral or slightly bearish on BTC and do not expect it to trade above $8,000, you can sell a put for 1 BTC and receive a premium of $200 that is yours to keep.
If the price of BTC falls to $6,500, the premium will offset some of the loss. If the price of BTC rises above $8,000, the premium will boost your profit beyond $1,000.
You can treat the premium as income or use it to buy (free!) protection for your portfolio.
Be prepared for the halvening
Why limit yourself to longing, shorting or hodling BTC to bet on the halvening? Try out these smarter ways you can bet on BTC halvening using options.
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Published at Mon, 20 Jan 2020 03:46:18 +0000
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