Deribit recently announced that it will start offering daily options on the bitcoin index on February 3. Every day at 08:00 UTC, users will be able to start trading options at an exercise price of $ 125. The contracts will expire two days after being entered.
The exchange will seek to offer contracts that move in a 5% range around ATM levels, Deribit announced. The news allows operators a much wider range of expiration dates and the platform will have contracts that expire every day.
"These deadlines are particularly interesting for investors and operators with a short-term vision based, for example, on macroeconomic data or events," reads the post. Luuk Strijers, Chief Communication Officer of Deribit, said that the exchange introduced daily options in response to "market demand".
Launched in 2016, Deribit dominates the crypto options market. Data from the analyst firm Skew show that the Deribit options represent almost 90% of the total volume traded on Tuesday 28 January, for a value of approximately 50 million dollars.
In comparison, the Bakkt regulated platform did not do business and the CME option contracts represented around 2% of the trading volume. Regulated bitcoin options have entered trading only in the past two months. Bakkt launched option trading last December and CME followed suit with its option contracts in early January.
OKEx, on the other hand, proposed unregulated option contracts on December 26th. Data show that Deribit remained in pole position and recorded a record month for volume in December. The monthly market share, on the other hand, decreased, falling by around 10% in January.
This is likely due to the interference of rival exchanges from the same sector, such as OKEx and CME, while Bakkt reported zero volume on its platform last week.
New products, new customers
Emmanuel Goh, co-founder and CEO of Skew, said he was not surprised that Deribit's market share had collapsed due to new competitors.
The exchange had the privilege of making the first move, but it was foreseeable that it would shrink with the entry of other companies into the sector. OKEx quickly came second thanks to its ability to offer new products to its customer base in Asia.
But the introduction of daily options could make Deribit more competitive. Mati Greenspan, founder of the analysis company Quantum Economics, said that adding new products usually helps an exchange grow its potential customer base.
“Each client is unique and will have different trading styles, strategies and requests from his broker. So having multiple products helps the supplier to satisfy more customers. A good broker will have a tendency to understand the needs of his clients and will take them into consideration when creating new products and services, "he said.