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With U.S. elections fast approaching, Bitcoin traders brace themselves for what could be an explosive week. Data from DeFi derivatives platform Derive shows Bitcoin volatility predictions climbing, potentially as high as 20%, while November 5—Election Day—looms large. This hype gains momentum as Bitcoin nudges past $70,000, briefly hitting $71,200, a level not seen since early June.

Rising Bets on Bitcoin, $80K the Next Target

In the midst of this rally, Derive founder Nick Forster hints at some dicey strategies surfacing. A massive concentration of bets clusters around the $80,000 strike price, with short-term call sales dominating the scene. Traders are selling these calls aggressively, skimming premiums as they gear up for what could be a jittery period.

“The overwhelming dominance of calls being sold suggests a strategic premium collection by traders, while the focus around the $80,000 strike highlights a potential pivotal point for Bitcoin,” said Forster. These call options make up 47% of all options sold in the last 24 hours, revealing that traders are prepared for either side of the election fallout.

Bitcoin’s $70K surge has emboldened sentiment, with traders cashing in on “juiced premiums” stirred by election anxiety. This indicates a proactive attempt to profit from the pre-election buzz, as options markets grow increasingly reactive to the potential influence of U.S. policy directions.

Traders Hedge for Election Volatility Spike

Short-term volatility metrics have ramped up, surpassing long-term projections, with analysts noting a peak in fluctuation as election results emerge. Forster points to a noticeable rise in short-term options expiring within seven days, indicating that traders see Election Day as a major catalyst for price moves. While the direction of the swing remains uncertain, traders anticipate Bitcoin’s trajectory will get whiplashed by political news.

Americans face a choice between Kamala Harris and Donald Trump, with Trump vocal about his pro-crypto stance. That posture has added an extra layer of tension among traders, who now hedge even more to mitigate unexpected shifts. The cost of these hedges, known as the volatility risk premium, is climbing—showing traders are betting big on price fluctuations.

Forster suggests Bitcoin could swing 10% with a one-in-three chance, while a sharper 20% movement has a 5% probability, both pegged to election results.