The Spread: Quarantined

This week on The Spread, bitcoin option volume spikes as bitcoin craters, the VIX closes at an all-time high due to coronavirus concerns, the NYSE closes its doors as two traders test positive for COVID-19, and more.

Produced by Mike Forrester.


Welcome to the Spread, where like you, we’re playing it safe and waiting the coronavirus out at home. I’m shooting this from my apartment this week, so welcome to my home! No need to take your shoes off, but please try to avoid touching your face. Daily volumes for bitcoin options reached an all-time high of $248 million on March 12 when bitcoin crashed hard, going from almost 8K per coin to less than 5K in hours. Most of the options volume came from unregulated exchanges outside the U.S., like Deribit and OKEx. Unfortunately, the same could not be said for regulated exchanges like Bakkt and CME Group. Just 3 of the CME’s bitcoin options contracts were sold on Wednesday – the CME’s lowest daily volume for bitcoin options on record. Still, that’s 3 more contracts than Bakkt traded the same day. Bakkt’s options contracts haven’t traded since February 24 – can’t blame that on the quarantine. There is good news for Bakkt though; the platform scored $300 million in a series B funding round this week. Hopefully that should get Bakkt back on track in time for the market’s next heart attack. Speaking of which, there’s a lot more fear going through the markets right now than there has been in at least over a decade. The VIX reached its highest closing point ever on Monday at 82.69, later reaching 85.47 on an intraday basis on Wednesday as concerns over the coronavirus continued to worsen. Turns out pandemics have a way of making people freak out – who could have seen that coming? VIX Futures for March also settled this week at 69.76, beating the old record of 67.5 set-in October 2008. Looks like everyone’s hedging Chicago style – early and often. After the CME and Cboe announced they were closing their trading floors last week, the NYSE defiantly tried to keep their floors open at first, but after two traders tested positive for coronavirus on Wednesday, the exchange announced it was closing its doors and switching to all-electronic trading. I was often scolded when I was a kid for spending too much time on the computer – looks like everyone’s doing it now! Maybe I was just a trendsetter. Things have gotten so crazy that some, like certain fund managers from Vanguard and Blackrock, are calling for the markets to be closed entirely – because the best way to stop a trainwreck is, of course, to put up a big wall for everything to crash into at once. The U.K.’s FCA said it would do its best to ensure all U.K.-based markets would continue functioning. The U.K. knows after all how to keep calm and carry on. U.S. Secretary of the Treasury Steven Mnunchin (MIN-OO-CHIN) said that the government is committed to keeping the markets open, even if trading days have to be temporarily shortened to make sure that happens. The CME Group issued a statement from Terry Duffy saying that such a measure made “no sense.” I have to agree with him – I mean, doesn’t shortening the trading day mean that everyone will be scrambling to get more done in a shorter amount of time? That’s how accidents happen, and there is no quantity of hand sanitizer or face masks in the world to protect against human folly. That’s it for this week – whether you’re in an office or working from home, stay safe and happy trading.



Bitcoin’s implied volatility drops, but Options still project restricted trades

CME Bitcoin Options Volume Hits Record Low, While Bakkt Goes Weeks With No Trades

Bakkt Raises $300M as Crypto Consumer App Coming This Summer

NYSE to Close Trading Floor After Two Positive Coronavirus Tests

Some Top Asset Managers Argue Financial Markets Should Close

Britain’s FCA to keep stock markets open in the face of virus volatility

Treasury Secretary Mnuchin says financial markets will stay open, but could shorten trading hours

Cboe Options Exchange Temporarily Shifts to Fully Electronic Trading – SEC Enables Immediate Effectiveness of Proposed Rule Change to Facilitate Continued Operations in Light of Temporary Suspension of Cboe Physical Trading Floor

Cboe VIX data

VIX Index Historical Data



A young woman wearing a hijab on a pink background.

Asma Awass

I am a Finance and Business Analytics student at UIC. I am an active member of my university’s boxing club and I also enjoy the creative arts.

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