Several large, deliberate trades hit the band recently, building this concentration of open interest at the $70,000 and $72,000 levels. Laevitas identified a large bull call spread structure that involved buying the $70,000 call and simultaneously selling the $72,000 call.
The bull call spread, as the name suggests, bets on a moderate rally in the prices of the underlying asset, in this case up to $72,000.
“The structure accounts for approximately 49% and 50% of total open interest at the $70K and $72K strike, respectively,” noted Laevitas.
Other notable trades included calendar spreads, a strategy used to take advantage of volatility changes in near-term and short-term maturities.
Another trader or group of traders bought a large number of calls at $70,000 and paid a $3.4 million premium to gain upside exposure.
Jimmy Yang, co-founder of Orbit Markets, an institutional provider of liquidity in digital assets, pointed to similar trades and said these were driven by Clarity Act optimism.
“Earlier this month, we saw decent demand for BTC topside calls, with the $70,000 and $72,000 strikes on July 31 being particularly popular. Much of this positioning was driven by expectations that the CLARITY Act could be passed before the end of the month,” Yang said.
