One of the all-time record market bubbles saw the Bitcoin price hit the dizzying height of $19,783 in December 2017. The following year saw an almighty crash with the price bottoming at around $3,179, a massive drop of 83.90%
Following that, Bitcoin dropped off the radar of most investors, but it is back making headlines again after an impressive recovery in the last couple of months.
Bitcoin is currently trading a $5,218 which is a healthy 64% higher than the 52-week low.
Things are looking up in crypto land, but will it last?
While there aren’t any bitcoin ETF’s, there are a couple of blockchain ETF’s at investors disposals.
Blockchain ETF’s are a nice way to gain exposure to Bitcoin for those that don’t want to actually buy Bitcoin’s.
BLCN, BLOK and LEGR are the 3 main ETF’s related to blockchain.
Below, you can see that BLOK has had a nice rally since the December low and has just crossed above the 200 day moving average.
Unfortunately, while there are options available on these blockchain ETF’s, the liquidity is virtually non-existent.
Another way to play the bitcoin rally is via the semiconductors. Mining of cryptocurrencies requires the usage of semiconductors. SMH is the most popular semiconductor ETF and it has also been performing well lately.
Options on SMH are much more liquid, so that would be a better underlying if you wanted to go with an option play.
Either way, it seems like the remainder of the year should be interesting in crypto land.
Let me know what you think in the comments below. Have you ever traded bitcoin or any of the blockchain ETF’s?
Disclaimer: The information above is for educational purposes only and should not be treated as investment advice. The strategy presented would not be suitable for investors who are not familiar with exchange traded options. Any readers interested in this strategy should do their own research and seek advice from a licensed financial adviser.