According to the forecasts of a major investment bank Goldman Sachs, the next big thing for the crypto market will be more easily realizable options markets. This is due to the fact that financial companies are increasingly investing in cryptocurrency.
The company is seeing a lot of demand for risk insurance through options. Open interest in bitcoin options, today is more than $12 billion, for comparison in the first half of 2020 it did not exceed $2 billion.
In order to hedge against existing risks – or take on additional risks to execute large face value trades – investors are utilizing cryptocurrency options.
“Instead of dynamic portfolio rebalancing, companies want to hedge for the long term and know the downside of hedging they can have. There are more versatile ways to hedge specific risks with options than with futures alone,” said Andrei Kazantsev, head of cryptocurrency at Goldman Sachs Bank.
Feedback (0)
Leave a review