Top Cryptocurrency Options Platforms
For the purpose of identifying the leading cryptocurrency options trading platforms across the globe, our panel of specialists has conducted a thorough examination of more than a dozen exchanges that provide derivatives contracts for puts and calls. This exhaustive assessment was guided by key criteria, including interface usability, regulatory compliance, security measures, liquidity, range of available assets, customer service quality, and fee structure. As a result, we've distinguished the top five platforms below that outshine the rest.
Bybit earns our top recommendation as the preeminent platform for those keen on trading cryptocurrency options. Founded in 2018, this specialized exchange has carved a niche in the futures and options trading landscape. Bybit is not just well-respected within the industry but also boasts a broad assortment of coins for margin trading. Though it facilitates spot market purchases of cryptocurrencies, its primary focus remains on options and futures contracts.
What sets Bybit apart are its distinctive features: it offers European-style USDC-margined contracts for BTC, ETH, and SOL, along with portfolio margin maintenance to minimize the margin needed for multiple positions. Moreover, it undercuts competitors with its industry-leading fee structure for options contracts, standing at 0.01% for Maker and 0.06% for Taker fee rates respectively. Given its concentrated expertise and user-friendly design, Bybit stands unmatched as the overall best platform for cryptocurrency options trading.
Deribit is a crypto derivatives exchange that was launched in 2015, aimed primarily at professional options traders and institutional investors. It is the largest crypto options platform in the world by volume, boasting over $300m in daily trading activity. Deribit offers European-style coin-margined contracts for BTC and ETH, with portfolio margin maintenance available to reduce the margin required for multiple positions. Options contracts on Deribit have 10x leverage available, with fees starting from 0.03%.
Deribit provides access to the Bitcoin and Ethereum options market with professional-grade speed and security, making it an efficient and comprehensive platform. The platform offers daily, weekly, monthly, and yearly options contracts, allowing for a range of trading strategies to be implemented. Contracts on Deribit are coin-margined, meaning traders must deposit BTC or ETH to open positions. If users prefer to use USDC or USDT for funding, we recommend Bybit as the best alternative.
Binance is a leading cryptocurrency exchange that has expanded beyond spot markets with the introduction of the Binance Options trading platform. Binance offers both American and European-style USDT-margined contracts for BTC, ETH, and BNB, with some of the lowest transaction fees in the market starting at 0.02%.
Binance's options trading platform is familiar and potentially advantageous to existing Binance users, but it is still applicable to those who have more experience outside of the Binance ecosystem and institutional investors. All collateral requirements and positions on Binance are settled using USDT, and no margin requirements need to be met.
OKX, a cryptocurrency exchange that has been around since 2016, is one of the top crypto options platforms for beginners thanks to its slick and easy user interface. It offers European-style coin-margined options for Bitcoin, Ethereum, and Solana with with contract expiration dates ranging from daily to bi-quarterly. OKX uses a maker/taker-style system for option fees, with taker fees starting at 0.03%, and an additional 0.02% exercise fee applies to exercised contracts. All margin and settlement requirements are completed in the corresponding digital asset.
An important factor to consider when using OKX for options is its low liquidity. The options on OKX typically trade around $1 million in daily volume, making it nearly impossible for high-net-worth and sophisticated investors to use the platform. This is why we recommend OKX primarily for beginner traders.
5. Delta Exchange
Closing our list is Delta Exchange, a notable no-KYC platform for cryptocurrency options and derivatives trading. Traders can begin trading without the need for extensive verification, making it appealing. However, it does fall short in liquidity, trading less than $1 million on their options contracts.
Delta presently offers BTC and ETH options with European-style coin-margined contracts. With its simple and intuitive user interface, it is especially suitable for beginners. Fees stand at 0.03% maker and 0.06% taker, with no additional charges for contracts exercised before expiration. Margins are fulfilled using the respective digital asset.
American-Style Crypto Options vs European Options
American-style and European-style options represent two distinct categories of derivatives contracts, prevalent in both cryptocurrency and traditional financial markets. American-style options offer greater flexibility, as they can be exercised at any point up until the expiration date.
Conversely, European-style options follow a more rigid structure, as they can only be exercised on the expiration date itself. This contrast in exercise patterns makes each style uniquely suited to different trading strategies and risk management approaches.
Is Trading Crypto Options Safe?
Trading crypto options can involve risks like any other investment or trading activity. Options trading can be complex, and the price of the underlying asset can be volatile, which can lead to sudden losses. However, with proper risk management strategies and due diligence, trading crypto options can be a safe and potentially profitable way to diversify a portfolio.
It is essential to understand the risks involved and only trade with funds that you can afford to lose. Additionally, it is recommended to choose reputable options platforms with proper security measures and a track record of transparency and reliability.
The Bottom Line
In conclusion, the dynamic world of cryptocurrency now provides investors with viable opportunities to optimize their trading strategies through options trading. Key platforms like Bybit, Deribit, Binance, OKX, and Delta Exchange lead the field in 2023, each offering unique features tailored to different user preferences, from institutional traders to beginners, and no-KYC trading.
It is essential to remember that while options trading presents an attractive avenue for potential profits, it also carries inherent risks. Investors should always exercise careful due diligence, proper risk management strategies, and only trade with funds they are prepared to lose.