put options

Selling Bitcoin Put Credit Spreads Against a Covered Call

A Bitcoin covered call is simple in principle: hold BTC, sell a call at a strike where selling BTC would be acceptable, collect premium and accept that upside above the strike may be given up.

The position needs more thought when the call remains open for weeks and Bitcoin trades above its strike. The short call is then in the money, the BTC holding still carries full downside exposure, and the decision is no longer only whether to wait for expiry. The call can be left alone, closed or rolled.

There is another choice in some conditions: leave the longer-dated covered call open…