Derivatives Exchange Deribit Launches Daily Ether Options

The new ETH options will be tradable for just 24 hours before expiry.

AccessTimeIconFeb 17, 2020 at 4:00 p.m. UTC
Updated Sep 13, 2021 at 12:18 p.m. UTC

Panama-based cryptocurrency derivatives exchange Deribit has listed daily options on ether (ETH).

The platform announced the news on Twitter on Monday. The new product will have strike price intervals of $5 and can be traded in the 24 hours preceding the expiry at 08:00 UTC every day. They will have a lifetime of two trading days at the time of introduction.

From Feb. 19, the exchange will also be reducing the tick size for all ether options from the current 0.001 ETH to 0.0005 ETH, Deribit CMO Andras Caron said.

Options are derivative contracts based on the value of the underlying instrument. A call option (bullish bet) gives the holder the right but not the obligation to buy the asset at a specific price on or before the predetermined date. Meanwhile, a put option (bearish bet) represents the right to sell.

Deribit launched longer duration cash-settled options on ether at the end of March 2019. Since then, the exchange has traded an average daily volume of $1.9 million, according to Skew Markets.


Volumes have risen sharply on the exchange this year with the increased price activity in the ether market. Notably, a record single-day volume of $13 million was registered on Feb. 13. The cryptocurrency recently rose to a seven-month high of $290 and has gained nearly 100 percent so far this year.

The derivative space has heated up over the past few months with big names including Chicago Mercantile Exchange (CME) and Intercontinental Exchange's Bakkt launching options on bitcoin (BTC).

Deribit, however, is still the leader when it comes to options volume. As of Jan. 28, Deribit accounted for nearly 90 percent of the global volume, according to Skew.

The latest decision to launch daily ETH options comes two weeks after daily bitcoin options went live, and could attract more users for the exchange, particularly from day traders.

"Daily options only have one or two days remaining lifetime and thus lower time value or premium and thus [are] cheaper. These shorter-dated, cheaper options are great instruments to use for short term strategies enabling the trader to hedge events or benefit from expected short term moves," said Caron.


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