Options traders crowd into Coinbase calls as bitcoin rebounds

Coinbase Global shares rose roughly 11% on Tuesday to about $178, while bitcoin climbed to its highest level since mid-June, according to CNBC market data. The move came as the S&P 500 had changed little over the prior five sessions, leaving digital-asset-linked equities to draw a larger share of short-term trading interest.

Options activity pointed to strong demand for bullish exposure in companies and funds tied to crypto prices. In Coinbase, more than 114,000 call contracts changed hands versus just under 50,000 puts, with bought calls outnumbering bought puts by more than four to one, according to CNBC’s summary of market flows.

Call options give buyers the right, without the obligation, to purchase a stock or fund at a fixed strike price before expiration. Traders use them to seek upside exposure with a defined upfront premium, while put options are commonly used to position for declines or hedge existing holdings.

Coinbase had traded below $150 earlier in July, a level CNBC said the stock had tested and held several times since early 2024. The rebound on Tuesday put attention on whether crypto-related equities could extend gains if bitcoin’s recovery continued.

SpotGamma data cited by CNBC showed more than $100 million in Coinbase options premium had traded by midday Tuesday. About $80 million of that total was linked to call contracts. The busiest contract by volume was the $190 call expiring Friday, a short-dated position that would require the stock to rise about 7.5% from the cited trading level to reach the strike before expiration.

Robinhood Markets, another brokerage with exposure to retail trading activity, also saw call-heavy options volume. Of roughly 170,000 total contracts traded in Robinhood shares, 125,000 were calls, and bought calls exceeded bought puts by a ratio of six to one, according to ThinkOrSwim data cited by CNBC.

Trading in the iShares Bitcoin Trust ETF, known by its ticker IBIT, also showed demand for upside exposure, though with a more mixed profile. CNBC reported that more than twice as many calls were bought as puts in the fund, while total call selling exceeded call buying, a pattern it characterized as more neutral to moderately bullish than the activity in Coinbase.

Strategy, the bitcoin treasury company associated with Michael Saylor, also saw call buying. CNBC reported that traders bought twice as many calls as puts in the stock, which had fallen more than 75% over the past year.

The options activity does not establish where crypto prices or related equities will trade next. It does show that, as bitcoin strengthened on Tuesday, traders used short-dated and equity-linked derivatives to express renewed interest in the sector’s upside.

This story draws on original reporting from CNBC.