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Chicago's Options Traders Are Turning Bitcoin's Wild Swings Into Monthly Paychecks

MarketDash Editorial Team
25 days ago
Chicago ETF managers are leveraging the city's deep options trading expertise to transform crypto volatility into steady income streams, blending Bitcoin with traditional assets in ways that appeal to risk-conscious financial advisers.

Chicago didn't become the options capital of America by accident, and now its traders are applying that expertise to crypto in ways that would make the CBOE proud. At MarketDash Fintech Day & Awards 2025, three ETF managers explained how they're using Chicago's financial DNA—options strategies, execution technology, and wealth management infrastructure—to turn Bitcoin's notorious volatility into something advisers can actually sell to clients.

Making Bitcoin Palatable for Nervous Advisers

Mike Willis, Co-Founder of Cyber Hornet ETF, described how his firm's S&P 500 and Bitcoin 75/25 Strategy ETF (BBB) targets what he calls "the Bitcoin-curious" among financial advisers. The fund pairs 75% S&P 500 exposure with 25% Bitcoin, smoothing the volatility that keeps wealth managers up at night while preserving meaningful upside if crypto rallies. The fund initially used Bitcoin futures to sidestep custody headaches, though Willis noted plans to transition to spot holdings soon.

When Volatility Becomes a Feature, Not a Bug

Kevin Kelly, founder of Kelly Intelligence, manages the Amplify Bitcoin 2% Monthly Option Income ETF (BITY) and Amplify Bitcoin Max Income Covered Call ETF (BAGY), and he's figured out how to turn crypto's chaos into a paycheck. By systematically selling covered calls on Bitcoin, Ethereum, and Solana, his products generate 2% to 3% monthly returns—effectively converting crypto's "omnipresent volatility" into dividend-like income.

"We help monetize that volatility for two facets. We have two Bitcoin products (BITY and BAGY). One (facet), because we're selling on the entire portfolio of Bitcoin, returning all of that volatility in the form of fiat essentially through monthly distributions. The other one is we're selling on a portion to get 2% a month," Kelly explained.

The strategy works because Bitcoin's volatility consistently ranges between 40 and 70, creating reliable premium income for option sellers. "People have had a hard time figuring out how to peg the volatility. And so we turn that into opportunity by doing monthly distributions on these products," Kelly added. When volatility spikes, income rises—a feature that's attracting investors hunting for yield alternatives to bonds.

Double Your Exposure, Smooth Your Ride

David Dziekanski, CEO of Quantify Funds, outlined his firm's BTGD ETF, which "stacks" 100% Bitcoin exposure on top of 100% gold through a leveraged portable alpha structure. The approach captures diversification benefits from two assets that rarely move together, with gold typically cushioning Bitcoin's violent drawdowns.

"We stacked 100% Bitcoin on top of 100% gold. It's a portable alpha approach. It's not a new concept. PIMCO has been doing it since the 90s. They initially had their stock plus funds," Dziekanski explained. The structure reduces path dependency because the fund rebalances between two uncorrelated assets internally, rather than forcing investors to time their entries.

"These two assets tend to, for example when Bitcoin has a 15% or greater drawdown, hold its uncorrelated benefits to Bitcoin. So gold is usually down somewhere between -4% and up high as 14% when Bitcoin has those 15% draw downs," he noted. Quantify plans to expand this model with new "income stack" ETFs combining Bitcoin, gold, equities, and Treasuries.

Chicago's Crypto Reinvention

The panel agreed that crypto's path to mainstream adoption runs through products that meet advisers on their terms: regulated, yield-generating, and risk-managed. As Chicago's options traders and fintech builders continue innovating in this space, the city is quietly becoming the institutional capital of crypto ETFs—proving that sometimes the best way to handle volatility is to sell it to someone else, one covered call at a time.

Back to News

Chicago's Options Traders Are Turning Bitcoin's Wild Swings Into Monthly Paychecks

MarketDash Editorial Team
25 days ago
Chicago ETF managers are leveraging the city's deep options trading expertise to transform crypto volatility into steady income streams, blending Bitcoin with traditional assets in ways that appeal to risk-conscious financial advisers.

Chicago didn't become the options capital of America by accident, and now its traders are applying that expertise to crypto in ways that would make the CBOE proud. At MarketDash Fintech Day & Awards 2025, three ETF managers explained how they're using Chicago's financial DNA—options strategies, execution technology, and wealth management infrastructure—to turn Bitcoin's notorious volatility into something advisers can actually sell to clients.

Making Bitcoin Palatable for Nervous Advisers

Mike Willis, Co-Founder of Cyber Hornet ETF, described how his firm's S&P 500 and Bitcoin 75/25 Strategy ETF (BBB) targets what he calls "the Bitcoin-curious" among financial advisers. The fund pairs 75% S&P 500 exposure with 25% Bitcoin, smoothing the volatility that keeps wealth managers up at night while preserving meaningful upside if crypto rallies. The fund initially used Bitcoin futures to sidestep custody headaches, though Willis noted plans to transition to spot holdings soon.

When Volatility Becomes a Feature, Not a Bug

Kevin Kelly, founder of Kelly Intelligence, manages the Amplify Bitcoin 2% Monthly Option Income ETF (BITY) and Amplify Bitcoin Max Income Covered Call ETF (BAGY), and he's figured out how to turn crypto's chaos into a paycheck. By systematically selling covered calls on Bitcoin, Ethereum, and Solana, his products generate 2% to 3% monthly returns—effectively converting crypto's "omnipresent volatility" into dividend-like income.

"We help monetize that volatility for two facets. We have two Bitcoin products (BITY and BAGY). One (facet), because we're selling on the entire portfolio of Bitcoin, returning all of that volatility in the form of fiat essentially through monthly distributions. The other one is we're selling on a portion to get 2% a month," Kelly explained.

The strategy works because Bitcoin's volatility consistently ranges between 40 and 70, creating reliable premium income for option sellers. "People have had a hard time figuring out how to peg the volatility. And so we turn that into opportunity by doing monthly distributions on these products," Kelly added. When volatility spikes, income rises—a feature that's attracting investors hunting for yield alternatives to bonds.

Double Your Exposure, Smooth Your Ride

David Dziekanski, CEO of Quantify Funds, outlined his firm's BTGD ETF, which "stacks" 100% Bitcoin exposure on top of 100% gold through a leveraged portable alpha structure. The approach captures diversification benefits from two assets that rarely move together, with gold typically cushioning Bitcoin's violent drawdowns.

"We stacked 100% Bitcoin on top of 100% gold. It's a portable alpha approach. It's not a new concept. PIMCO has been doing it since the 90s. They initially had their stock plus funds," Dziekanski explained. The structure reduces path dependency because the fund rebalances between two uncorrelated assets internally, rather than forcing investors to time their entries.

"These two assets tend to, for example when Bitcoin has a 15% or greater drawdown, hold its uncorrelated benefits to Bitcoin. So gold is usually down somewhere between -4% and up high as 14% when Bitcoin has those 15% draw downs," he noted. Quantify plans to expand this model with new "income stack" ETFs combining Bitcoin, gold, equities, and Treasuries.

Chicago's Crypto Reinvention

The panel agreed that crypto's path to mainstream adoption runs through products that meet advisers on their terms: regulated, yield-generating, and risk-managed. As Chicago's options traders and fintech builders continue innovating in this space, the city is quietly becoming the institutional capital of crypto ETFs—proving that sometimes the best way to handle volatility is to sell it to someone else, one covered call at a time.