Analyst: Options and derivatives may drive Bitcoin's market value to $10 trillion

ChainCatcher news, according to market news, market analyst James Van Straten pointed out that derivatives such as options contracts will drive Bitcoin's market capitalization to at least $10 trillion. He believes that derivatives can not only attract more institutional investors but also effectively buffer the inherent high volatility risks of the digital currency market.

Van Straten cited the record high open interest in Bitcoin futures at the Chicago Mercantile Exchange (CME) as an example to illustrate that the market structure is undergoing significant changes. He analyzed that this phenomenon is partly due to the widespread use of systematic volatility selling strategies (such as covered call strategies), reflecting the enhanced liquidity and increasingly mature structure of the Bitcoin derivatives market. At the same time, he also pointed out that the reduction in volatility has a two-way effect: while it can alleviate the common severe downturns in the crypto market, the high-yield surges that investors are accustomed to will also correspondingly decrease.