2 years ago
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The new product addition will help traders take advantage of volatility, hedge risk and discover prices through options, which are generally simple and have no special or unusual features.
For investors interested in this new trading vehicle, Bybit options contract follows the European-style options, which may be exercised only at the expiration date of the option, i.e., at a single pre-defined point in time. It can be traded through portfolio margin, which adopts a risk based model for experienced traders, including market makers and institutional clients, to increase fund utilization based on the underlying price and volatility.
Bybit’s new options trading offering is based on user feedback, and upon launch users will be able to trade USDC options and perpetuals, it says.
The roll-out of options product, quoted in dollar-backed stablecoin USDT, came on the heels of a trial period which examined common feedback in order to improve the user experience of optimization of margin and risk control mechanisms.
This function will support Bybit in becoming a fully integrated trading powerhouse with a user-friendly interface that provides open API support, to facilitate flexibility in trading European-style, linear options.
As more sophisticated investors enter the crypto market, the notice reflects increasing investor interest in trading derivatives, which let traders make bets on the price of cryptocurrencies without the need for actual delivery.
Both futures and options are a way for investors to bet on the trends of a cryptocurrency price without having to actually hold the underlying coin, which skirts regulatory and custodian issues. However, futures are, in general, riskier than options as the only financial liability for the latter is the premium paid at the purchase time. On the other hand, futures contracts involve maximum liability.
“Options is something that our existing clients have long been asking for since there has been no other revolutionary product offered in the market at the moment,” said Ben Zhou, co-founder and CEO of Bybit. “We are confident that our state-of-the-art offering will set the bar for the sector and normalize crypto options trading, just like what Robinhood did for stock options. We are also excited to bring with us to options trading the world class liquidity and reliability our clients have come to associate with Bybit.”
Bybit has been an integral participant in the continued mass adoption of cryptocurrency investments, and the launch of options trading is yet another milestone. The move also comes as the popular exchange continues to branch out of its singular focus on crypto derivatives with a suite of new product offerings. Although derivatives are to remain at the heart of Bybit’s business, the popular platform added spot crypto trading and a copy trading feature as it aims to aggressively grow their user base.
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