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Bitcoin’s hike of 68% in April did not save Deribit Options’ 47% turnover slump

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April kickstarted Bitcoin’s recovery and the derivatives market joined the bandwagon as well. However, while Futures and spot volumes were improving across various exchanges, according to Deribit’s monthly newsletter, the landscape was quite different for the largest BTC Options institution.

Source: Deribit

Now, according to a newsletter shared with AMBCrypto, the total turnover for April 2020 was down by 47 percent, in comparison to March 2020, for Deribit. Amassing about $8.5 billion, it is the second-lowest monthly returns for the exchange since April 2019.

In terms of Futures and Perpetual Open Interest, the crash took its toll over there, as well as with the overall volumes depleting since mid-March.

Source: Deribit

In terms of Bitcoin Options contracts, a total of 202,088 BTC contracts were traded during the month of April, slumping down by 37 percent with respect to March 2020.

ETH Options contracts shared a similar fate as the number of contracts traded dropped by 28 percent, down to 443,217 ETH from approximately 580,000 contracts in March.

The newsletter added,

“Total options turnover was USD 1.6 billion in April 2020, down 31% versus March 2020 and 15.5% of the volumes were contributed by the new daily options, 3 percentage points higher versus March.”

Recently, it was reported by TokenInsights that a major drawback associated with Options trading is that the number of underlying assets is limited, and Bitcoin is the only major crypto-asset that acts as a legitimate investment vehicle.

Additionally, it was also mentioned that market makers or exchanges on the Options market cannot fully hedge position risks and have to be exposed to market risks, especially when the market is volatile.

Silver lining in the current market?

Source: Skew

Even though the Options market did not experience a lucrative period like Bitcoin’s Futures and spot volumes, the Open Interest on Deribit ended the month on a high over the last couple of days. The Open Interest expressed in USD was growing towards the end of April, registering around $723 million or 81K contracts, a figure that was up by 15K, when compared to March 2020.

With Bitcoin’s price maintaining levels above $8500, the Options market is expected to pick up pace in the month of May, and we could be witnessing another surge in the derivatives market over the next few weeks.


Biraajmaan is a full-time journalist at AMBCrypto covering the US market. A graduate in Automobile engineering, he writes mainly about regulations and its impact with a focus on technological advancements in the crypto space.
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