Trade Bitcoin

Bitcoin Call Spreads: A Better Way

Nadex Bitcoin and Bitcoin Monthly Mini Call Spreads let you trade the price of Bitcoin (based on the trusted TeraBit IndexSM) without having to own bitcoins.

  • The Bitcoin Call Spread has a one-week duration and a larger tick value of $0.10 per point of the underlying index
  • The Bitcoin Monthly Mini Call Spread is a month-long contract with a tick value of $0.01 per point of the underlying Bitcoin index

 

Open an Account

Trade all the markets you love

 

Watch: How to Short-Sell Bitcoin Using Call Spreads

There's no need for wallets or conversion, since the contracts are settled in US dollars. Best of all, it's as easy to trade price drops as it is to trade rallies. Short-selling Bitcoin is as easy as buying when you use Bitcoin Call Spreads.

As the price of Bitcoin varies up and down, the call spread's value moves as well, but with limits. Above the ceiling or below the floor, the value of the call spread stops moving and remains at its upper or lower limit (depending on whether you are a buyer or seller).

In this way, your risk-reward remains within a defined range. One limit is your profit target. The other is your guaranteed protection against unlimited losses.

 

Bitcoin opportunity without the hassle

Since its "hacker" beginnings, Bitcoin and cryptocurrency have gone mainstream and soared in value. More traders than ever want to add cryptocurrencies to their portfolios.

Until now, most Bitcoin traders have used a "buy and hold" strategy. However, Bitcoin's volatility makes it great for short-term trading, as well.

Nadex Bitcoin Call Spreads allow you to take short-term positions on the price of Bitcoin, with risk-reward protections built in. Selling is as easy as buying, meaning you have profit opportunities no matter which direction the Bitcoin market is trending.

Trade the price of Bitcoin without buying and selling the bitcoins themselves. No "mining," no risk exposure outside your comfort level—you can just trade with all the benefits of the Nadex exchange: capped risk, transparent price, and CFTC regulation.

Choose the duration and size that fit your strategy

Nadex offers both a weekly contract and a monthly mini contract:

  • The Bitcoin Call Spread has a one-week duration and a larger tick value of $0.10 per point of the underlying index
  • The Bitcoin Monthly Mini Call Spread is a month-long contract with a tick value of $0.01 per point of the underlying Bitcoin index

Both contracts let you exit prior to expiration. The larger contract is suited to traders who want to day trade or swing trade short-term movements in price. The Mini-Bitcoin Call Spread contract starts on the first of the month and lasts until the end of the month. It lets you take longer positions with a smaller capital requirement.

 

Bitcoin Call Spread Trading Example

A Bitcoin call spread lets you trade in such a way that your risk and reward are contained within a floor-to-ceiling price range. For example a call spread contract might be named:

Bitcoin Weekly Call Spread 3200.00 – 11200.00

This means that the price range you are trading lies between a floor (low) of $3200.00 per bitcoin up to a ceiling (high) of $11200.00 per bitcoin. At 1/10th the per point value of the underlying market, the total value of this contract with an 8000-point range would be $800.

As an example, let’s say the Bitcoin market was trading at a price of 5200.00 on Monday afternoon. You believe the market is due to rally higher over the next few days and decide to buy the Nadex Weekly Bitcoin call spread at 5200.00.

Your maximum risk in this scenario is to the floor of the call spread contract (3200.00) or $200.00. With a total contract value of $800.00, your maximum potential return is to the ceiling of 11200.00, or $600.00

You placed the trade on Monday. On Wednesday you check your position and see that Bitcoin has indeed rallied to a price level of 8200.00. The 3000 point climb in Bitcoin, represents a $300.00 gain in your Nadex Call Spread position. At this point you decide to exit early and lock in the $300.00 gain.

It is that simple and hassle free. No bitcoin wallets, no currency conversion, just straight forward trading the way it was meant to be.

 

Contract Specifications

 


 

Frequently Asked Questions

 

 

Look in the Finder window at the left and click on Cryptocurrency > Bitcoin > Weekly.

The underlying market for Nadex Bitcoin Call Spreads is based on the TeraBit IndexSM from TeraExchange. For more information about TeraExchange and their cryptocurrency benchmark indices, click here.

Yes, the price of the underlying market (Bitcoin) will be displayed in the markets window in the Indicative Price column. You can also view live charts to track and analyze current and historic market prices. Click on the stairstep icon in the Charts column.
** Please note, the indicative underlying index will not be available from 6:45 to 7:00 PM ET during exchange maintenance.

The Nadex Bitcoin call spread contract has a duration of 1 week. The Mini-Bitcoin Call Spread contract opens on the first trading day of the month and expires on the last trading day of the month.

You can trade Bitcoin Call Spreads from Monday 8 AM ET to Friday 3 PM ET, except between 5 and 6 PM ET when the exchange closes for maintenance.

Nadex assesses current market levels and conditions to create a call spread range that will bring our members the best possible trading experience. As such, the range and overall contract value may vary based on where Bitcoin is trading in a given week (or month, for the Mini contract).

The total value of the Nadex bitcoin call spread may vary depending on market conditions and the width of the range between the floor and ceiling of the contract. However, when you place a trade, you will always be able to see and select your maximum risk and profit potential on the order ticket, before you place the trade order.

The minimum tick size is $5.00 in the underlying Bitcoin market. That represents the smallest increment the price can move. The tick value of the Nadex Bitcoin call spread contract is $0.50. Thus the effective value of the Nadex Call Spread contract is 1/10th the point value of the underlying Bitcoin market. Our goal is to provide an affordable way for our members to trade Bitcoin. For additional contract specifications, please visit this page.

The Bitcoin Call Spread contract is settled to the last tick prior to expiration as provided by the TeraBit Index.

During the launch period, members may enjoy reduced fees of $1 per contract to enter a trade and another $1 to exit at or before expiration. However, Nadex will waive your settlement (exit) fee if the market settles below the floor price (for long positions), or above the ceiling price (for short positions). Thus, your maximum possible fees would be $2 a round-turn per contract. After the launch period, the fees will be $2 per contract on entry and another $2 to exit at or before expiration. Nadex will still waive the settlement fee for trades which incur the maximum potential loss.

If the volatility of the market pushes the underlying price near to or past the floor or ceiling of the contract, Nadex may, at our discretion, list an additional call spread contract suitable to current market conditions.

No. You do not need a digital wallet. You just need a regular Nadex account, funded in US dollars. We hold member funds in segregated accounts in secure, top-tier US banks. Nadex Bitcoin Call Spreads are cash-settled and don’t involve the exchange of physical bitcoins. To put it simply, you will buy and sell the contracts using US dollars and be able to withdraw funds from your account (after a short initial waiting period) in US dollars at any time.

Nadex is regulated by the Commodity Futures Trading Commission (CFTC), and all trading on Nadex, including Bitcoin Call Spreads, is subject to CFTC regulatory oversight.

 

 


 

Latest Bitcoin Articles View All Bitcoin Articles

Many Markets Did Not Open On Wednesday, But Bitcoin Never Sleeps

On Friday evening, November 30 the forty-first President of the United States George Herbert Walker Bush passed away at ninety-four years of age. He...

Bitcoin Waited Patiently for A Breakout, and It Got It

Last year at this time, Bitcoin was on its way to its all-time high in a parabolic move that took the cryptocurrency to an all-time peak at over $19,...

Bitcoin’s Trading Range Creates A Bonanza of Opportunities

Bitcoin continues to frustrate the many investors who came to the digital currency market in late 2017 with dreams of untold riches. In 2010, Bitcoin...