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Open interest for Ether options at all-time highs

Updated: Aug 31, 2024
Published: Jul 23, 2020
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Crypto Options

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This year has been a major advancement for options in the world of cryptocurrencies as they saw a somewhat similar raise in interest from market participants as futures did in 2017. Depending on the strategy used, options essentially allow traders to bet on volatility (directional or delta-neutral).

ETH Options OI

The open interest is the metric used most often to see how eager market participants are to trade derivatives. Recently, Ether options same their open interest climb fast and created new all-time highs.

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While far from the Bitcoin options open interest, $200 million remains significant for an asset class of this size (under $300 Billion in total market capitalisation). This is especially relevant when thinking the open interest has almost quadrupled when compared to the first quarter of this year.

Volatility Expected?

As explained in the first part, options are mainly a tool to bet on volatility and the past few weeks saw a very large decrease on that end as the market started ranging very tightly; especially large caps.

First and foremost, given the volatile nature of cryptocurrencies it is natural to expect volatility to rise again. But the main reason ETH options are seeing new ATH is very likely related to the fact that ETH2.0 is on the horizon. However, it is important to note that while expectations are high there has been no concrete answer on when that is to be expected.

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