OKEx is adding cryptocurrency options to its existing offerings of spot and futures trading.
The Malta-based exchange said Monday that simulated options trading will commence on Dec. 12, with live trading kicking off on Dec. 27. Both buy and write options will be provided.
To cut the risk of manipulation of closing prices, OKEx said it averages spot data from a number of platforms to get a "fair" settlement price for its options products.
"The options mark price is determined by OKEx in real time using the Black-scholes pricing model. Since a single transaction or quote cannot affect the options market – which only responds to estimated options volatility," the exchange said.
To get trading, platform users will have to complete a "suitability test" to show an understanding of the options products, as well as pass know-your-customer verification.
“Options is a unique instrument that enable traders to manage, price and hedge the volatility of crypto assets with a combination of option contracts," OKEx CEO Jay Hao said. "As the crypto market evolves, we aim to build a complete derivatives product suite, delivering solutions to optimize users’ trading strategies. OKEx Options is a major step towards this goal.”