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Why Trade BTC Options Instead of BTC Futures?

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Tue, 21/04/2020 - 20:44
Why Trade BTC Options Instead of BTC Futures?
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Options, one of the cryptocurrency derivatives market, is quickly expanding since 2019. Options trading is heading for the mainstream, just as futures did during the height of the crypto mania in 2017.

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Many crypto exchanges also have rolled out Bitcoin options in the past few months. According to derivatives tracker Skew, options trading has been mostly a niche of professional traders. Average daily volume has hovered around $22 million for the past year, while daily volume for Bitcoin spot is $1 billion and $10 billion for the Bitcoin futures market.

Why BTC Options Let Down BTC Futures?

From Market Perspective

According to an oft-cited empirical analysis by the Journal of Finance, options listings for an asset lead to “a decrease in the spread and increases in quoted depth, trading volume, trading frequency, and transaction size” and, overall, results suggest “that option listings improve the market quality of the underlying stocks.” To put it simple, Bitcoin options can benefit the entire ecosystem, whether a specific individual uses them or not. Looking at the market as a whole, options have also been shown to be critical for market health. And the increasing sophistication of options markets has the potential to pave the way for an influx of institutional players which could ultimately improve liquidity over time.

From Traders Perspective

Demand for options tends to rise with a spike in volatility. Options contracts are beneficial to traders for its ability to hedge against the risk of sudden price changes. Options trading gives traders the right, but not the obligation, to buy or sell specified amount of bitcoin on an expiration date. A call option gives traders the right to buy, while the put option the right to sell. In addition, it helps traders to limit losses and create unique payoff profiles. 

Where can We Trade BTC Options?

There are a number of Bitcoin options trading venues currently on the market, with various pros and cons, fees, geographic restrictions, capital restrictions and user experiences. A number of popular Bitcoin options trading venues available, including Bakkt, Ledger X, IE Option. If you want to trade options in U.S. with NO KYC, IE Option is the best choice for you. 

IE Option is bitcoin-based exchange registered in United Kingdom. It’s established in late 2019 by a team of blockchain and financial experts who ever worked in City of London before. IE Option devotes to simplifying the complex options contracts and make it easy for newbie traders, yet professional for veteran traders as well. Options contracts of BTC, ETH, LTC and EOS are tradable in IE Option.

Earn Up to 1.91 BTC in 1 Minute

You can bet on the Bitcoin trend by placing Call (Buy/up) or Put (Sell/down) option. For example, if you invest in 1 BTC to place a call option, and the market goes in the direction you predict, you will win 1.91 Bitcoin. 

10 BTC Max Bonus

All users can enjoy up to 100% bonus for the first deposit and each can get up to 10 BTC. For example, if you deposit 2 BTC at a time, you will get 4 BTC in total credited in your account. In other words, you have 50% extra chance to get profits.  

Demo Account with 10 BTC

If you haven’t trade options before, you can claim 10 free BTC in demo account. When you learned how to make profits in options contract, you can switch to live trading and make a fortune. 

Trade in Android & iOS

IE Option’s Android and iOS apps are available in Google Play and App Store. With the app, you can profit on each volatility on the go. 

Download app from Google Play

Download app from Appstore

*A tip for trading Bitcoin options before you go ahead

For instance, if you make wrong prediction and place a call option at a strike of $7,000 and the contract hasn’t expired, you can place a put option immediately. In this way, you can hedge the loss in the call option! 

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Disclaimer: This is sponsored content. The information on this page is not endorsed or supported by U.Today, and U.Today is not responsible or liable for any inaccuracies, poor quality, advertising, products or other materials found within the publication. Readers should do their own research before taking any actions related to the company. U.Today is not responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in the article.

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