Deribit to Offer Linear Options on XRP, SOL, and MATIC
Deribit, a cryptocurrency derivatives exchange, has announced that it will introduce “linear options” for XRP, SOL, and MATIC starting in January. Despite the current low volatility in the digital asset market, Deribit remains committed to its growth initiatives. The company is also seeking to obtain a brokerage license within the European Union.
Increase in Market Volatility Expected in January
Deribit’s Chief Commercial Officer, Luuk Strijers, acknowledges concerns about launching new products during the current market conditions. However, he remains optimistic about increased market volatility in January when the new linear options will be launched.
Decline in Cryptocurrency Derivatives Trading Volume
Bloomberg reports a decline in cryptocurrency derivatives trading volume, which has dropped from $2 trillion at the beginning of the year to $1.5 trillion in September. This decrease is attributed to lower digital asset prices and volatility compared to the highs of 2021.
Anticipating Market Impact of New Offerings
Traders are eagerly awaiting the potential market impact of recently launched Ether futures exchange-traded funds and the possible approval of Bitcoin spot ETFs by U.S. regulators. These developments are expected to reintroduce volatility into the digital asset market.
Deribit’s Expansion Beyond Bitcoin and Ether
Deribit’s expansion will include options beyond Bitcoin, Ether, and USD Coin for the first time. The exchange plans to relocate from Panama to Dubai, known for its crypto-friendly policies, once it obtains the necessary license. Deribit currently employs 115 people and intends to add another dozen to its workforce.
Altcoin Linear Options as Effective Hedging Strategy
The introduction of altcoin linear options is seen as a more effective hedging strategy for diverse crypto portfolios, particularly due to the reduced volatility of Ether. Richard Galvin, co-founder at Digital Asset Capital Management, believes these options will provide better risk management for investors.
Deribit’s Dominance in the Options Space
Bloomberg reveals that Deribit holds an 85% market share in the options space, with competitors like OKX, Binance, and Bybit making up the remaining share. The exchange primarily serves institutional clients, accounting for approximately 85% of its trading volume.
Zero-Fee Spot Crypto Trading Platform
Earlier this year, Deribit launched a zero-fee spot crypto trading platform. However, the primary objective of the platform is to facilitate derivatives trading rather than compete in the token buying and selling market.
Hot Take: Deribit Expands Options Offering Beyond Major Cryptocurrencies
Deribit’s decision to offer linear options on XRP, SOL, and MATIC demonstrates the exchange’s commitment to diversifying its product offerings and catering to the evolving needs of crypto traders. By introducing these new options, Deribit aims to provide more opportunities for investors to manage risk and enhance their portfolios. Despite the current low volatility in the market, Deribit remains optimistic about future market conditions and expects increased volatility in January. As the leading player in the options space, Deribit’s expansion beyond Bitcoin and Ether further solidifies its position as a key player in the cryptocurrency derivatives market.
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