Bitcoin trading firm suggests a bullish trade with a key financing twist

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BTCBTC$72,615.76◢1.54%

• Quant-focused trading firm TDX Strategies is recommending a low-cost "bullish risk reversal" on bitcoin, using premiums from selling out-of-the-money puts to finance the purchase of out-of-the-money calls.
• The structure aims to build upside exposure in March and April while minimizing upfront cost.
• TDX sees potential geopolitical headline-driven volatility, including risks tied to the anticipated confirmation of Mojtaba Khamenei as Supreme Leader, as a tactical opportunity to enter this options-based bullish position.

Quant-driven trading firm TDX Strategies is pitching clients a bullish bitcoin trade with an interesting financing twist that helps offset the cost of the bet while reshaping the position’s risk profile.

The Hong Kong–based firm suggested a “bullish risk reversal” strategy on Wednesday, which involves selling a put option (insurance against a downtrend) and using the premium earned to buy bullish call options – essentially funding bullish bets with income from put writing.

This way, the trader effectively pays little or nothing upfront while remaining exposed to a bitcoin rally.

It reflects a broader shift toward more sophisticated, options‑driven positioning, as traders look to stretch their capital further and fine‑tune their risk instead of just piling into spot or straightforward bullish leveraged bets.

A call option is a contract that lets the buyer bet the price of an asset will rise above a specific level, called the strike price, by a certain date. If the price climbs above that strike, the buyer can profit; if it doesn’t, they usually just lose the small fee they paid for the option. It's analogous to buying a lottery ticket.

A put option does the opposite. It lets the buyer set up protection against a potential drop in the asset below a specific strike price by a certain date. If it does, the put buyer stands to gain; if it doesn't, the entity stands to lose the initial premium paid. It's akin to buying insurance.

TDX’s suggested play combines the two in such a way that the trader becomes the seller of out‑of‑the‑money (OTM) puts (insurance) and collects the premium on one leg, then redeploys it to buy an OTM call on the other leg.

The result is a low‑cost bullish structure compared with simply buying a call outright. An out‑of‑the‑money (OTM) call is an option whose strike price is above the current market price of Bitcoin, while an OTM put is one whose strike price is below the current market price.

"The anticipated confirmation of Mojtaba Khamenei as Supreme Leader introduces an added element of risk of immediate retaliatory escalation, however, we view any headline-driven market jitters as a tactical entry point," TDX said in a market note.

"We are looking to capitalize on temporary weakness to build upside exposure in March and April [expiry], favoring bullish risk reversals (funding OTM calls by selling OTM puts)," TDX added.

The strategy is not without risk. By selling out‑of‑the‑money puts, the trader is obligated to buy Bitcoin at the strike price if the market crashes below that level, which means he ends up acquiring the asset at a price higher than its prevailing market value.

At the same time, while the calls offer upside participation, their high strike prices mean they may expire worthless if the rally falls short of expectations. In effect, the trader trades a lower upfront cost for a more asymmetric payoff: limited upside above the call strike and meaningful downside exposure below the put strike.

The position, therefore, requires close monitoring and may not be suitable for new investors or those with limited capital and a weak grasp of options dynamics.

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• Bitcoin has surged about 10% this week to trade above $72,000, briefly topping $73,900 on ETF-driven inflows.
• The cryptocurrency is approaching a critical price zone between roughly $73,750 and $74,400 that has repeatedly marked major turning points over the past two years.
• A decisive break above this zone would signal renewed bullish momentum, while failure to clear it would reinforce the broader downtrend that began in October.

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