Derivatives Exchange Deribit To Roll Out Daily Bitcoin Index Options Trading
Crypto exchange firm Deribit is set to launch daily Bitcoin options to fend off intense competition within the crypto options market. The firm revealed beginning Feb. 3, they will begin to provide daily Bitcoin index which will be scheduled at 08:00 UTC each day of the year. Through a press release, the firm also announced that the trading options will start at a strike price of $125. The contracts will officially expire after two days of listing.
The exchange strives to provide contracts that range at about 5% around at-the-money (ATM) levels. The new offering provides investors varied options when it comes to expiry dates as the exchange will have contracts that expire each day.
According to Luuk Strijers, the head of communication in Deribit, the daily options have been launched to address market demand. He said:
“These short-dated expiries are specifically interesting for investors and traders with a short-term view based on for example macroeconomic data or events.”
Deribit was started in 2016 and is the largest firm in the crypto options sector. As data from Skew, a data analytics startup, shows, almost 90% of the entire volume that was traded on Tuesday came from Deribit options. On the same day, Bakkt had zero trades while CME option contracts accounted for just 2% of the day’s trading volume.
Licensed Bitcoin options started to trade recently. Bakkt rolled on the options trading a few days to the December holiday season. This was followed by CME which its options trading at the start of January. OKEx is also another big name in the market, has introduced its unregulated options trading on Dec.26.
Deribit has maintained its pole position in the market. However, the firm has been losing its market share since the start of this year due to the entrance of new players. On the other hand, OKEx and CME have been increasing their market share since January. The launching of the daily options is a strategy to maintain Deribit’s market position and also deal with the competition.