Crypto derivatives exchange unveils options trading for Chainlink

By Alexander Behrens

Move over Bitcoin and Ethereum, options trading is coming to altcoins.

Singapore-based crypto derivatives exchange Delta announced on Friday the launch of options trading for two altcoins, Binance’s BNB and Chainlink’s LINK tokens. The move could be seen as evidence of a maturing market for cryptocurrency derivatives and an acknowledgement of the growing importance of Binance and Chainlink in the digital asset ecosystem.

While a variety of exchanges and institutions offer options contracts for Bitcoin and Ethereum, Delta Exchange is the first to offer options on assets beyond crypto’s two leading products. Several exchanges also currently offer futures contracts for Bitcoin and Ethereum as well as altcoins, but futures and options contracts are distinct financial products. 

Futures contracts represent an obligation to buy or sell the underlying asset at a given price at the expiration date. By contrast, options contracts give the holder the right (but not the obligation) to buy or sell the underlying asset at an agreed upon price at any time before the contract expires. 

Total BTC open interest. Image: Skew

“There are only a handful of crypto derivatives exchanges offering options trading at this point in time and most of them only support options on BTC and ETH,” CEO of Delta Exchange Pankaj Balani said in a statement. Balani explained that his firm has had success with BTC and ETH MOVE options products and saw an opportunity to offer “highly competitive Altcoin Options.”

Following the launch of BNB and LINK options, Delta Exchange also plans to offer options trading for Tezos’ XTZ, Cosmos’ ATOM, Ripple’s XRP and Litecoin’s LTC cryptocurrencies in the near future. BNB and LINK contracts will offer up to 10x leverage and will be offered for weekly durations. 

Delta Exchange launched in 2018 and added Bitcoin and Ethereum options trading to the platform in March 2020.

“MOVE Options contracts help traders trade volatility without taking any directional risk,” Balani said. “When trading these contracts, a trader is betting on the absolute value of the price movement of a coin rather than the coin going up or down.”

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