> Someone was bidding up $50 puts expiring in 3.5 weeks and buying contracts today, while the shares were in the mid-300s. That's insane implied volatility.

Because the higher you are, the closer you are to a crash. Peaks take time to build, but crashes can happen overnight (or premarket).

The put is just another instrument that trades. What will under normal circumstances keep a put close to the "correct" price? Well, if the price goes too high, people will start writing puts, driving the price down.

If you write a put, you're long the stock. To hedge yourself, you'll need to short it. To the extent that that is difficult right now, nobody will be willing to write puts. (Strictly speaking, the put is so out of the money right now, that one would not have to short much today. But as soon as the stock price falls and approaches the strike, the writer of the put would need to start shorting. "Hey, anyone got some shares I could borrow?")

On the other hand, if you want to take a negative view on the company, buying a put is sensible thing to do. That'll drive the price of the puts up.

That's just a cheap way to bet on the trade being played out by then: buy some deeply out of the money puts with a relatively low premium today (the further out of the money, the lower the premium... so you can afford to buy more) with the expectation that they'll be deeply in the money in a few weeks. Works a treat... as long as you're not wrong on direction, magnitude or timing.

> The stock rocketed up today and the puts rose about 20% as well

This is called IV expansion.

The implied volatility isn't insane if the underlying is, you know, insanely volatile.