Crypto Derivatives Exchange, Huobi Futures, Rolls Out Bitcoin Options As Demand Increases
The crypto derivatives section of Huobi Group, Huobi Futures has announced that starting September 1st, it will offer Bitcoin Options trading.
In a blog post, Huobi Futures stated that Bitcoin options will be quoted in the dollar-pegged Tether (USDT). The derivative exchange also revealed that the Bitcoin options will be provided in weekly, bi-weekly as well as quarterly increments. Option clients will have the right to purchase or sell only on expiry.
The exchange firm also stated that the Bitcoin options product is set to provide traders with extra ways of creating arbitrage as well as hedge risk within the crypto space. It is important to note that options products provide traders with the right but not an obligation to purchase or dispose of Bitcoins at a predetermined price as well as date.
“Options will give users a robust set of tools to execute more sophisticated trading strategies,” explained Huobi Group’s vice president in charge of global business, Ciara Sun. She added that while financial products such as options do not necessarily guarantee profits, they allow traders to have enhanced flexibility as well as extra opportunities.
To be specific, a Call Option provides the purchaser of the option a specific right to buy the specific asset at an agreed price as well as date. On the other hand, Put Options offer the purchaser the right to sell at an agreed price as well as date.
Ciara also clarified that the decision to roll out the Bitcoin options product was informed by the market demand as well as the increasing number of institutional players in the crypto space.
She explained that investors are bracing for a longer economic uncertainty in the world's’ financial markets and there has been a surge of institutional players in the digital assets market. This has seen an increase in demand for more innovative trading products which is the reason Huobi introduced the Bitcoin options product.
Huobi also stated that it has witnessed an increase in derivatives trading volume in the recent past. The firm revealed that the crypto derivatives trading is growing at a faster rate than spot trading.
Huobi joins other crypto exchanges which offer Bitcoin options trading such as OKEx, Deribit, Bakkt, CME and LedgerX.