Institutions Increasingly Apply Bitcoin Options Strategies to Altcoins, Says STS Digital
STS Digital reports that institutional investors are increasingly using bitcoin options strategies for altcoins to manage volatility and enhance returns. This trend is driven by demand from venture capitalists, foundations, and large holders, leading to a rise in altcoin options trading.
Common strategies include selling covered calls on altcoins, selling puts, buying puts to hedge risks, and buying calls to gain upside exposure with defined risk. The October 10 market crash and resulting auto-deleveraging losses pushed institutions to seek more robust risk-management tools beyond bitcoin.
STS Digital annually settles billions of dollars in altcoin options volume through bilateral trades and acts as a principal dealer providing liquidity across more than 400 cryptocurrencies. While Deribit remains a major derivatives platform focusing on Ethereum, XRP, and Solana, STS Digital offers a broader range of altcoin options.
Industry executive Maxime Seiler anticipates continued growth in options tied to bitcoin and other tokens, noting that adoption is accelerating. He also highlighted that periods of low volatility are often seen as opportunities to enter the market ahead of potential catalysts.
