Deribit attributed the addition of such a high strike to „market demand“. On Thursday, December 17, bitcoin updated an all-time high, climbing above $23,700 (Bitstamp).
So far, users have purchased 52 call contracts and no puts.
Deribit data indicates there are optimists willing to pay $940 (at the time of writing) for bitcoin to more than quadruple in the next three quarters. Should the price of the first cryptocurrency exceed the psychological barrier, these „calls“ will go „into the money“. They are now „deep out of the money“.
The buyer of an option receives the right to buy or sell a bitcoin asset (on Deribit, each contract is equivalent to one bitcoin) at an exercise price (strike price) on a specific date (expiration date). The seller undertakes to buy or sell the asset at the request of the option holder. The latter pays the seller at the time of purchase of the contract a certain amount of money – the so-called premium.
To understand how options work, our material will help you.
Recall that Deribit has obliged all users to be verified by the end of the year. The platform took this step following a similar decision by BitMEX, which launched a new KYC program in August.
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