Deribit Introduces XRP, SOL, MATIC Option

As The Block reported earlier today, Deribit, a leader in the cryptocurrency derivatives exchange market, has announced its decision to broaden its offerings by incorporating linear options for Solana (SOL), XRP, and Polygon (MATIC).

In the context of cryptocurrency derivatives trading, when Deribit refers to “linear options,” it is likely highlighting a specific type of options contract that has a direct, or “linear,” relationship between the option’s price movement and the price movement of the underlying asset. This means that the value of the option contract moves in tandem with the price of the underlying cryptocurrency, such as Solana (SOL), XRP, or Polygon (MATIC), in a straightforward manner.

Linear options contrast with non-linear derivatives, such as traditional options, where the relationship between the price movement of the option and the underlying asset can be more complex due to factors like volatility, time decay, and the option’s strike price. Linear options simplify this relationship, making it easier for traders to understand and predict the potential profit or loss from their trades.

In practical terms, linear options on Deribit would allow traders to speculate on the future price movements of these altcoins or hedge their positions in them, with the payout directly correlated to the actual price movements of the underlying assets, without the complexities that often come with traditional options trading. This can be particularly appealing for traders looking for straightforward, easy-to-understand trading instruments in the volatile cryptocurrency market.

According to The Block, Luuk Strijers, Deribit’s Chief Commercial Officer, shared insights via email regarding the platform’s decision to expand its altcoin options. Strijers highlighted the inclusion of SOL, MATIC, and XRP as a response to the growing interest from Deribit’s clients, indicating a strategic move to cater to the market’s demand for a wider range of cryptocurrency derivatives.

The Block further reports that Strijers views the introduction of USDC-based altcoin options as a “natural progression” for Deribit. With the platform already capturing over 85% of the open interest in Bitcoin and Ethereum options, this expansion into altcoin options represents a significant step towards diversifying its offerings and enhancing its market position.

Deribit’s remarkable growth trajectory was also spotlighted by The Block, noting that the exchange achieved its highest turnover since May 2021 in January, totaling $83.3 billion.

Additionally, The Block highlighted Deribit’s record-setting engagement levels in January, with the platform witnessing the highest number of corporate accounts trading within a single month, alongside a significant rise in unique retail participants since December 2021. This surge in both corporate and retail involvement illustrates the broadening appeal of Deribit’s trading platform and its offerings.

It was on 9 October 2023 that Deribit first announced its plans to empower cryptocurrency traders globally further by introducing linear options for SOL, XRP, and MATIC.

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