IBIT options desk dominance in the Bitcoin market

September’s $2.4 billion notional open interest for IBIT options surpassed gold ETF records. I see the dominance clearly. IBIT options capture 75% to 80% of total Bitcoin spot ETF options trading volume. This volume averages over $2.5 billion in notional daily trading. The average daily volume hits 600,000 to 650,000 contracts. This translates to a notional daily volume of $2.7 to $3.0 billion.

The liquidity gap is massive. IBIT put bid-ask spreads stay at $0.02 for strikes near the current price. In comparison, the bid-ask spread for FBTC is $0.45. FBTC only holds 11% of the total volume. IBIT’s raw contract open interest sits at 7 million. This puts the total USD notional value at $31.5 billion. This value exceeds GLD’s total options notional value of $30 billion. GLD has only 700,000 contracts and 6.44 million in open interest. I find the spread between IBIT and FBTC embarrassing. IBIT AUM is $65 billion, while FBTC is $15 billion and GBTC is $12 billion. The September 14 expiry shows a $45.00 call with 2,602 in open interest and a $0.09 last price. The $44.50 call shows 453 in open interest and a $0.18 last price. The $44.50 put has 1,456 in open interest and a $0.89 last price.

The institutional migration

Institutional players favor regulated markets. I see them moving away from crypto-native venues. By April 2026, IBIT open interest reached $27.6 billion, which surpassed Deribit’s $26.9 billion for the first time, signaling that regulated US products now hold more weight than offshore crypto-native venues. This transition changes price discovery. Market makers manage this through gamma exposure. Their hedging activity creates a mean-reverting force. This damps intraday price swings.

How much more capital will move to regulated desks?

IBIT dominates the market.

Bitcoin’s one-year rolling volatility has declined cycle over cycle. I see a 38% decline in average volatility compared to the 2015 to 2018 period. Zero-days-to-expiration volume grew 46.2% year-to-date. This volume exceeds 20 million contracts a day. Cboe launched the BITVX 30-day volatility index to capture this. Position limits grew from 25,000 to 250,000 contracts. Nasdaq ISE and BOX filed to increase these limits to 1,000,000 contracts.

Strategy shifts and yield

BlackRock expands the product suite. They launched the iShares Bitcoin Premium Income ETF (BITA) on June 16, 2026. This fund writes call options against 25% to 35% of its NAV. It targets 15% to 25% annual yield. You should skip BITA if you want pure Bitcoin exposure. The fund caps your upside. BITA competes against the NEOS Bitcoin High Income ETF, which has $1.09 billion in assets under management. It also faces competition from the Roundhill Bitcoin Covered Call Strategy ETF, which holds $220 million.

The IBIT options chain provides tools for every trader. Professionals use puts to bound drawdowns without selling shares. Retail traders use calls for directional bets. The regulatory environment changed too. Position limits grew from 25,000 to 250,000 contracts. I find the spread between IBIT and FBTC embarrassing.

Calamos offers buffer products like CBOJ, CBXJ, and CBTJ to provide 90% or 80% downside protection over annual reset periods. Grayscale’s BTCC operates a similar strategy with a distribution rate of 41.81% as of July 2026. Bitcoin held by ETFs and companies reaches 12% of the total supply.