A mysterious trader known as '50 Cent' may have bet millions that volatility in the stock market will explode

• A trader nicknamed "50 Cent" may be placing big bets that the VIX - known as Wall Street's fear index - will surge.
• Someone has bought 100,000 call options for $0.50 each, betting $5 million the VIX will pop up to 50 in May.

Someone in the vast world of financial markets is betting big that US equities will run into heavy turbulence in the coming months.

That someone may be a trader nicknamed "50 Cent" who has in past positioned themselves to make money off of market volatility by way of consistently buying Cboe Volatility Index options that usually cost about 50 cents. The VIX - known as Wall Street's fear index - gauges the expected volatility of the US stock market.

The last round of purchases by the mysterious trader or traders is catching attention. Barchart, a provider of quotes and other market data, pointed out that someone late Tuesday purchased 100,000 call options for $0.50 each, betting $5 million the VIX will spike to 50 in May.

Then on Wednesday, another 50,000 contracts were bought for $0.51, a purchase valued at roughly $2.6 million.

"'50 Cent' is back. No, not the rapper. The trader who became famous years ago is likely back with a huge volatility bet," said Barchart to its nearly 65,000 followers on Twitter.

The anonymous trader has seized attention with major bets before, including a $200 million wager during a wild time in markets in February 2018.

Whoever "50 Cent" may be, they're anticipating a surge in the VIX as it currently sits around a 13-month low.

The VIX on Thursday soared 10% to push above 20. It was still down about 7% so far this year while the S&P 500 has gained more than 6%.

The anonymous trader may be anticipating, among a laundry list of market factors, a ramp-up in anxiety around interest rates, with recent inflation readings showing consumer and wholesale prices have been slow to come down year over year, and even signs of a pick-up in prices on a monthly basis.

Investors have been whittling down expectations the Fed will start to cut interest rates this year after policymakers rapidly pushed them higher. Talk around the Fed upsizing future rate hikes swirled Thursday. Cleveland Fed President Loretta Mester and St. Louis Fed President James Bullard each said they would've supported increasing the size of rate hikes to 50 basis points at the February policy meeting and that more rate increases are needed to further cool inflation.

As Fidelity notes, a VIX value of more than 30 is considered to signal heightened volatility from increased uncertainty, risk and investor fear. Values under 20 are usually linked to stable market periods.