Institutional Bitcoin Investment Lacks Confidence

The price of bitcoin has seen a 7% increase since Sunday, but its recovery has stalled near $72,000 due to uncertainty surrounding key events, including the upcoming US inflation report and US-Iran peace talks. Institutions are taking a cautious approach, buying call options to speculate on potential gains while also purchasing downside protection. According to QCP Capital, there is demand for call options that could lead to a price increase above $45 for BlackRock's spot bitcoin ETF. Similarly, options on Deribit show a strong interest in the $80,000 call. However, the demand for put options, which provide protection against declines, remains steady. The US consumer price index for March is expected to show a significant increase in annualized inflation, primarily driven by rising energy prices. This could lead to market volatility, especially if the core figure exceeds the estimated 2.7% annualized increase. The meeting between Iranian and US delegates in Pakistan could also impact financial market stability. A resolution to the conflict could lead to an increase in oil tanker traffic through the Strait of Hormuz, potentially accelerating bitcoin's rally. The ICE BofA US Bond Market Option Volatility Estimate Index, which reflects volatility in US Treasury futures, has shown a decrease in uncertainty after a sharp spike in March. This calm in the bond market could be a positive sign for crypto investors.