Ethereum Options Trade Volume Exceeds Bitcoin’s, Deribit Introduces a $50K ETH Strike for 2022


Last week, ethereum options volume surpassed bitcoin’s for the first time on the digital currency derivatives exchange Deribit. Further, the trading platform recently introduced a $50k ETH strike for March 2022 and explained the $50k call is “gaining immediate buy traction.”

Ethereum Options Volume Grows Exponentially, $50K Strike Flexes Muscle

When it comes to bitcoin (BTC) derivatives, the trading platform Deribit captures the lion’s share of today’s options volume. The cryptocurrency exchange also features bitcoin futures and ethereum options as well. During the first week of May, Deribit’s ethereum (ETH) options surpassed bitcoin (BTC) options for the first time.

Skew analytics data shows while BTC had $880 million on May 3, ETH options saw $1.3 billion. The volume continued that week as the analytics company Skew tweeted about the staggering ETH options volume last Thursday.

“Ether markets seeing record activity this week across spot, futures and options,” the analytics firm tweeted. “Options traders’ anticipations of ether volatility relative to bitcoin are rising,” Skew added the next day.

On May 10, the crypto derivatives exchange Deribit said: “ETH Option flows now dominating BTC. And not just Fast money.” During the last six months, Deribit has captured the largest number of BTC and ETH options in terms of volume and open interest.

“Action across maturities, with Deribit listing the ETH Mar22 50k Call (really!), gaining immediate buy traction. In general, Calls rolled up to keep/add exposure; decent 2-way Put action, but few reducing upside,” Deribit added.

Institutional Investors Fueling Ethereum Markets, $5K Strikes See Build-Up

Since ethereum has recently obtained all-time price highs on spot markets, traders and speculators have been focused on the top two leading crypto assets’ dominance levels.

The leading digital asset bitcoin (BTC) has 42.1% dominance in terms of market cap compared to the entire crypto economy ($2.29T). Ethereum on the other hand has a dominance level of roughly 19.8% at the time of writing.

“The second-largest crypto asset by market capitalisation has been moving in a sharp upwards trajectory since its latest hard fork as it continues to prove its use-case,” Simon Peters, the crypto asset analyst at the multi-asset investment platform Etoro wrote to News.

“The number of decentralised applications continues to grow on the platform. Demand from institutional investors is fuelling this latest move higher as large-scale buyers diversify their exposure in this emerging asset class, with ethereum the natural next pick,” Peters added.

In another tweet on May 11, Skew analytics mentioned ethereum (ETH) was seeing large “open interest build up on $5k strike.” Deribit further explained in its Twitter thread that ethereum term structure is in backwardation and BTC in contango.

BTC term structure is in contango. We would expect this from relative RV movement. But BTC IV is nudging higher in sympathy with ETH, on low volumes. Either expectation is of BTC move, or perhaps a shift of MM collateral to the action,” the exchange noted.

What do you think about the $50k ethereum options strike? Let us know what you think about this subject in the comments section below.

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