Cryptocurrency markets are inherently volatile. How can investors mitigate losses during downturns while capitalizing on upward trends? How can retail investors leverage small capital for amplified returns? How can institutional investors construct strategic portfolios to lock in profits? OKEx addressed these needs by launching ETH Options on June 4—a derivative product that diversifies trading strategies and enhances market appeal.
What Are ETH Options?
ETH Options are derivative contracts based on the ETHUSD index. Buyers pay a premium to secure the right (but not obligation) to buy/sell ETH at a predetermined price (strike price) on a future date. At expiration, buyers may:
- Exercise the option: Profit from price differentials.
- Let it expire: Lose only the premium paid.
Sellers face inverse outcomes: Maximum gain equals the premium (if unexercised), while potential losses are uncapped.
Key Features
- European-Style Execution: Can only be exercised at expiration.
Two Contract Types:
- Call Options: Right to buy ETH at strike price.
- Put Options: Right to sell ETH at strike price.
Factors Influencing ETH Options Pricing
| Factor | Impact on Price |
|--------|------------------|
| ETH Spot Price vs. Strike Price | Direct correlation for calls; inverse for puts. |
| Time to Expiry | Longer duration = Higher premium (time value). |
| ETH Price Volatility | Greater volatility = Higher option value. |
Benefits of ETH Options
- Risk Management: Hedge against price swings.
- Capital Efficiency: Amplify gains with limited upfront cost.
- Market Depth: Expands crypto derivatives ecosystem.
FAQs
Q1: How do ETH Options differ from futures?
A1: Options grant the right (not obligation) to trade, whereas futures mandate execution.
Q2: What’s the break-even point for a call option?
A2: Strike price + premium paid.
Q3: Can I trade ETH Options before expiry?
A3: Yes! OKEx supports secondary market trading.
👉 Start Trading ETH Options Today
Note: This article is for educational purposes only and does not constitute financial advice.
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