What are crypto options?

Crypto options are a type of derivative contract agreement that gives the holder the right (i.e., the option), but not the obligation, to buy or sell a specific underlying asset (such as a cryptocurrency) at a set price (referred to as the strike price) up until a set future date (also known as the expiry date ).

What are crypto derivatives?

A derivative is a tradeable financial instrument that derives its value from an underlying asset, such as a cryptocurrency. It allows traders to get exposure to the price movement of an asset without actually owning it. The two main types of crypto derivatives are futures and options.

What is the expiry date for crypto options?

You have the right to sell a cryptocurrency on any day leading up to and during an exact date. Since crypto options are agreements to potentially trade assets in the future, there must also be a date associated with these contracts for when these trades would take place. This date is called the contract “expiry” date.

What are the benefits of high volatility in crypto options trading?

The benefit of this high volatility is that traders stand to potentially make better returns if the market goes the way they predict because there will be a greater difference between the strike price and the settlement price at expiry. What platforms provide crypto options trading? How popular are they?