PANews reported on August 4th that according to CoinDesk, NYDIG Research stated that the SEC has raised the position limits for most Bitcoin ETF options, which is expected to smooth Bitcoin price volatility by encouraging strategies such as selling covered call options. This strategy, which aims to obtain stable returns, limits the potential for price increases. By allowing traders to hold ten times more contracts than before, the SEC has opened the door to more active and sustained options trading activities. Especially for covered call option strategies, which are most effective in large-scale trading.
Currently, Bitcoin volatility is declining, with Deribit's BTC volatility index (DVOL) showing a drop from 90 to 38 over the past four years, though still higher than traditional assets. NYDIG analyzed that the reduced volatility makes Bitcoin more attractive to institutions seeking balanced risk exposure, potentially strengthening spot demand and creating a cycle where decreased volatility drives increased spot buying, thereby promoting continuous demand growth.
