Discover how to speculate on Bitcoin’s price movements without owning the asset itself via Bitcoin options.
Bitcoin options contracts are a type of derivatives contract that allows investors to speculate on Bitcoin (BTC) price movements without owning Bitcoin itself. Bitcoin derivatives trading and investing in Bitcoin options are other routes that investors use to leverage the volatility of the cryptocurrency market.
In investing, a derivative is a product or contract with a value determined by an underlying asset. Cryptocurrency derivatives include futures, options and perpetual contracts. This basic Bitcoin options trading guide focuses solely on Bitcoin options, how investors trade them and some of the risks and strategies.
Here, a Bitcoin options contract derives its value from Bitcoin. Investors engage in speculating or “hedging” on the price volatility of Bitcoin. A Bitcoin options contract allows a trader to buy or sell Bitcoin at a previously agreed time and date.
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Source: https://cointelegraph.com/news/how-to-buy-and-sell-bitcoin-options