Ju.17, 2025
1. Bitcoin: The Ultimate Volatility Playground
Bitcoin remains crypto's most fascinating asset—not despite its volatility, but because of it.
Recent Gamma Explosions:
July 2025: Realized volatility spiked to 70 (vs. average 50)
Similar spikes: March 2024 (ATH $73K), August 2024 (yen carry trade)
Only 3 instances of such extreme volatility in Bitcoin's history
--> Key Insight: Bitcoin's pronounced gamma characteristics beyond simple delta moves suggest significant upside potential remains, driven by catalyst-sensitive demand dynamics.
2. Options: The Missing Piece in Crypto's Evolution
Why Options Matter More Than Ever
1) Fee Revenue Goldmine
Current crypto options volume: $51B+ monthly
Fee capture potential: 2-3x higher than spot trading
Institutional demand: Surging amid bull market conditions
2) Gamma Explosion Management
Traditional hedging inadequate for crypto's violent moves
Options provide precise risk management tools
Essential for institutional portfolio construction
3. Market Growth Trajectory
1) Market perspective
Open interest: Record $49.3B (May 2025)
Year-over-year growth: 300%+ in institutional adoption
Deribit alone: 85% global market share, $425B open interest
2) Sophisticated volatility management tools
Non-linear payoff structures
Capital-efficient hedging solutions
- The Institutional Imperative: dominantly on funds for hedge
- Hedge funds increasingly require: speculative or hedging purposes
4. Options aren't optional anymore—they're essential infrastructure.
1) The Current Market Reality: ELW-Level Dysfunction
Poor Liquidity = Poor Adoption
2) Typical Trading Experience:
Desired trade: 100 BTC call options (even all BOB conditions)
Available liquidity:
- Best bid: 5 contracts
- Next level: 3 contracts
- Third level: 7 contracts
3) Result: Excessive slippage, fragmented execution, trader frustration.
4) The ELW Problem Revisited:
Wide spreads: 0.5-5% vs. 0.01-0.05% in equity options
Thin order books: Popular strikes only
LP inadequacy: Few market makers, limited competition
5) Market Impact: Institutional players avoid crypto options → Perpetual liquidity crisis
5. Structural Issues
1) Monopolistic Concentration
Deribit: 85-90% market dominance
Limited competitive pressure
No incentive for spread improvement
2) Market Maker Shortage
High risk management costs
Regulatory uncertainty
Capital efficiency concerns
3) User Experience Barriers
4) Complex interfaces
Limited educational resources
High entry barriers for retail adoption
5.Industry Landscape: The Newcomers Challenge
1) Coinbase's Bold Move
$2.9B Deribit Acquisition (2025):
2) Strategic push into global derivatives leadership
Regulatory compliance advantage
Institutional trust factor
3) Market Signal: Even regulated US exchanges recognize crypto options' potential.
6. Binance's Inevitable Entry [Why not? Worth exploring.]
1) Why Binance Can't Stay on Sidelines:
500M+ user base = natural liquidity pool
Proven derivatives infrastructure
Global market leadership in futures
2) The Logic: If Coinbase—with its regulatory constraints—commits $2.9B to options, why wouldn't Binance leverage its massive advantages?
3) Current Limitation: Binance options remain "suboptimal for sophisticated traders" with "relatively low volume."
4)Technical Mastery: The Liquidity Programming Advantage is Our Core Competency
5) Proven Track Record:
Liquidity program development expertise
Advanced market making algorithms
Real-time risk management systems
6) Key Insight: Options success depends entirely on LP quality and commitment.
7) The Technical Reality
Multi-dimensional risk management (delta, gamma, theta, vega)
Dynamic hedging requirements
Sophisticated pricing models
8) Our advantages
Existing infrastructure easily adaptable
Battle-tested matching engines
Proven ability to handle extreme volatility
9) Step-up strategies in the Market Share
-Market Share Opportunity: The Numbers Don't Lie
-Current Market Distribution
Deribit: 70% ($35.7B volume)
OKX: 16% ($8.4B)
Binance: 9% ($4.8B) [limited offering]
Others: 5%
-Realistic Projection (24-36 months)
Improved execution: 50-70% spread reduction
Market expansion: 2-3x total volume growth
Our target: 25-30% market share
The Math: Even capturing 20% of an expanded market = $20B+ monthly volume
(Details might be changed)
10) Conclusion: The Inevitable Evolution
Market Forces Driving Change:
-Institutional demand exploding
-Regulatory clarity improving
-Competition heating upOur Position:
-Technical capabilities: ✓
-User base advantage: ✓
-Risk management expertise: ✓
-Strategic patience: ✓
The Only Question: Not whether we can capture significant market share, but how quickly we choose to do it.
In crypto's volatile landscape, options aren't just derivatives—they're the sophisticated instruments that separate amateur markets from institutional-grade infrastructure. The volatility that scares others? That's exactly what makes this opportunity irresistible.
