A trader purchased two million Dogecoin (DOGE) call options. The options, with a strike price of $0.22, were approved by Bernd Sischka, Chief Commercial Officer of derivatives exchange PowerTrade.
As of now, DOGE is trading at $0.1649. For this transaction to turn a profit, the price of memecoin would have to increase by more than 31%. Call options will expire on June 14.
Options are derivative contracts that give the buyer the right to buy or sell an asset at a predetermined price before the contract expires. If the underlying asset fails to reach the strike price, the contract will expire worthless.
Dogecoin actually reached the $0.22 level during its rally in March. However, beyond this level has not been reached since November 2021.
Sischka shared his views on the current situation of altcoins. “Altcoins have lagged behind the recent rise in Ethereum. Most traders are observing what ETH is doing and predicting potential moves for altcoins,” he said. He also added that the approval of the ETF triggered the ETH rally. However, he believes Dogecoin's wild card is Elon Musk's use of the token as a means of payment on Twitter.
*This is not investment advice.