Bullish to Offer Bitcoin Options Trading With Top-Tier Consortium of Trading Partners

Bullish (BLSH), the NYSE-listed digital assets platform focused on institutional investors and parent company of CoinDesk, will tentatively launch crypto options trading from Oct. 8.

These bitcoin BTC$90,494.54 options will be margined and settled in the regulated, dollar-pegged stablecoin USDC, which boasts a market cap of $73.85 billion at press time, the second-largest in the stablecoin industry. Additionally, they will be European-style options with expiries ranging from three weeks to three months. The contract multiplier will be 1, meaning one contract represents one full BTC.

The exchange plans to list options tied to ether, as well as other single assets and multi-asset indices, such as the CoinDesk 20 and CoinDesk 5, in the future.

Bullish's decision to launch options is part of a broader industry trend marked by increasing demand for hedging instruments across the full spectrum of crypto products. This growing appetite is exemplified by the rising popularity of options tied to BlackRock's spot Bitcoin ETF, which now rivals Deribit's BTC options.

"Bullish is investing significantly in its institutional offering,” said Chris Tyrer, President of Bullish Exchange. “Our journey began with spot trading, expanded to include margin, then perpetual and dated futures, and now reaches a new milestone with the introduction of options."

He added that the new product aims to deliver a complete derivatives product suite with capital efficiency and risk mitigation, all accessible through a single, unified trading account.

Options are derivative contracts that grant the holder the right, but not the obligation, to buy or sell a specific asset, such as bitcoin or other cryptocurrencies, at a predetermined price within a set time frame. A call option gives the right to buy, representing a bullish bet on the market, while a put protects against potential price losses.

The special thing about options is that they facilitate three-dimensional trading, allowing traders to bet on the price direction, the degree of price volatility and leverage time to expiration. This multi-faceted nature enables traders to create synthetic positions by combining spot, futures, and options markets, allowing them to manage risk with more tailored and flexible strategies.

Consortium of day-one trading partners

Bullish's new options have been designed in close collaboration with leading options market makers, technology providers, and brokers to ensure they are specifically tailored to meet the needs of institutional investors.

More importantly, from day one, these options will be supported by a range of confirmed industry heavyweights as trading partners, including Abraxas Capital Management, Ampersan, B2C2, BlockTech, Cumberland, FalconX, Fig Markets, Flow Traders, Galaxy Digital, Monarq Asset Management, Pulsar, SignalPlus, Wintermute, and Qube Research & Technologies.

“Galaxy is excited to support the next chapter of Bullish’s journey,” said Jason Urban, Global Head of Trading at Galaxy. “The addition of options to its product suite is a strong step forward – enhancing liquidity, deepening price discovery, and strengthening the overall maturity of the crypto derivatives market.”

Unified margin system

The global crypto options market is valued at over $50 billion in notional open interest, with Deribit alone accounting for more than 80% of the activity. In other words, the exchange has a massive head start compared to the impending Bullish options contracts.

Bullish's announcement stands out due to the platform's unified margin system, according to Tyrer.

"Bullish clients access all products via our unified account structure, allowing them to trade spot, perps, dated futures and now options with risk offsets and portfolio collateralization. This setup is designed for maximum capital efficiency, which is of paramount importance to our institutional client base," Chris Tyrer, President of Bullish Exchange, said.

On Deribit, Segregated Standard Margin is the default margin system, which means that standard margin, the initial margin and maintenance margin (MM) requirements are calculated separately for each position in the account. These requirements are then summed together to generate the total margin requirements for the account.

However, Deribit allows users to choose from four distinct margin systems depending on their trading style and risk management preferences, including the default option.

The other three are: Cross standard margin, which lets traders use funds from one asset as collateral to support positions in another; segregated portfolio margin, which calculates margin based on the net risk of the entire portfolio but keeps collateral separated by asset; and cross portfolio margin, the most flexible option, which combines cross-collateral capabilities with portfolio-level risk calculations to optimize margin usage across all positions and assets.

Vibrant futures market

Lastly, Bullish already has vibrant futures and spot markets, which are often seen as a prerequisite for a successful options product.

Since its launch in November 2021, Bullish has surpassed $1.5 trillion in cumulative trading volume. This year, the platform has executed over $2 billion in average daily volume and ranks in the top ten exchanges by spot volume for bitcoin and ether.

The business is licensed by the New York State Department of Financial Services, German Federal Financial Supervisory Authority, Hong Kong Securities and Futures Commission, and the Gibraltar Financial Services Commission.

11:05 UTC: Adds more on Deribit's margin