According to the announcement, the Malta-based exchange currently offers spot trading meaning purchase or sale of foreign currency, financial instrument or commodity for instant delivery on a specified spot date. It also offers futures trading and both of it in cryptocurrencies, A per the company, starting cash-settled options trading in BTC/USD pair begins on December 27 due to institutional demand.
CEO of OKEx Jay Hao said:
“We have been seeing the increasing demand of crypto derivative products across all our client segments, especially from our institutional clients, which have shown the fastest growing demand in derivative trading, especially on futures or perpetual swap.”
The other trading platforms traditionally work in a way that they support buy options. OKEx’s offering will have both buy and sell options. An options contract is an agreement between a buyer and seller that gives the purchaser of the option the right to buy or sell a particular asset at a later date at an agreed-upon price. Options contracts are often used in securities, commodities, and real estate transactions. In order to get access to the OKEx options, users will have to pass a regular know-your-customer (KYC) verification process, as well as go through a test of suitability to show their knowledge and understanding of options trading.
However, this is not all that OKEx decided to offer. The leading global cryptocurrency futures exchange platform also announced today that it plans to soon launch its USDT Margined Perpetual Swap Trading feature. As per the announcement, the latest USDT denominated linear contract offering is set to go live on December 16, 2019, following the simulation phase which went live on December 4. The simulation phase will go on until the 14th of this month.
The USDT-Margined Perpetual Swap will support 9 different trading pairs including BTC, EOS, ETC, ETH, LTC, XRP, TRX, BCH and BSV at the beginning, with a close possibility of more add-ons in the near future. Traders will be enabled to utilize 0.01-100x leverage to get the most out of their orders. By eliminating the need to reopen new positions, the latest feature will also help traders avoid paying extra transaction fees generally incurred while opening a new contract.
Futures have been often criticized for “wagging the dog” of spot trading. However, for altcoins, the chance to bet on the price without buying or dumping outright may ease some of the volatility.
OKEx is not the only one who recently decided to make such a move. Derivatives exchange giant CME Group is said to be also preparing for options product launch. As per its statement, the new product will be tied to its Bitcoin futures and should start with its activity on January 13. Also, the physically-backed Bitcoin Futures contracts company Bakkt launches its options contracts later today. As part of their ongoing effort, they are launching two new services that include a Bitcoin (USD) Options and Bitcoin (USD) Cash Settled Monthly Futures. Crypto exchanges Deribit and LedgerX have already been offering options trading.
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