In the latest development, report reveals that a trader makes a million-dollar bet that bitcoin will triple next year. According to the source, the trader betted that bitcoin will top $50,000 next year.
Online records from New York-based digital currency-trading platform LedgerX showed 275 call options expiring Dec. 28, 2018, were bought in Wednesday’s trading session at a volume-weighted average price of $3,600.
At that price, roughly $1 million was spent on the bet. The trade gives the investor or investors the option to buy bitcoin at $50,000 in the roughly next 12 months, implying expectations that the digital currency will soar beyond that price.
An investor would lose the bet if bitcoin doesn’t reach $50,000 in that time period but would reap profits if it climbs well above that level.
With bitcoin trading near $16,700 Thursday, that means the call options trader or traders expect the digital currency to soar more than 200 percent in the coming 12 months. Bitcoin is up about 1,900 percent over the last 12 months, according to Coinbase.
The transaction was first reported by The Wall Street Journal. Startup LedgerX is less than five years old and launched bitcoin options trading for institutional clients in October.