OKEx, a top full-service cryptocurrency exchange, announced earlier today that its new BTCUSD options trading product is now officially live on the OKEx website and API. The options instrument went live on 06:00 Jan 9, 2020 (UTC).
The contract is settled in BTC, and each option contract’s face value is 0.1 BTC. Investors pay a premium to buy a call or put option in order to lock in the prices for buying or selling the underlying asset upon the expiry of the contract.
OKEx BTCUSD Options Specifications
| Feature | Detail |
| Underlying | BTC/USD Index |
| Contract Type | Call and put options |
| Contract Multiplier | 0.1 |
| Lot size | 1 |
| Quote Coin | BTC |
| Settlement Coin | BTC |
| Tick Size | 0.0005 BTC |
| Exercise Style | European; In-the-Money (ITM) options will be automatically exercised and settled at expiration |
| Mark Price | Determined by OKEx using the Black model on a real-time basis |
| Creation Time | Normally half an hour after futures contracts with the same expiry date are opened |
| Expiry Time | 08:00 (UTC), Friday of the expiry week |
| Method of Exercise | Cash Settled in BTC |
| Final settlement Price | Time-weighted average of the underlying price over a period of time before the option expiries |
| Strike Price | OKEx will generate a series of reasonable strike prices based on market conditions before launching options contracts with new expiration. Also, new strike prices will be generated as the market condition evolves. |
| Exercise Payoff per Contract | Call options: Max {(final settlement price – strike price), 0}*contract multiplier, in USD. Upon settlement, the USD payoff will be converted into BTC at the final settlement price.
Put options: Max {(strike price – final settlement price), 0}*contract multiplier, in USD. Upon settlement, the USD payoff will be converted into BTC at the final settlement price. |
“OKEx BTCUSD options adopt a sophisticated risk management system which includes mark price rule, daily settlement rule, and Short Qualification rule. In order to minimize the risk of clawback, OKEx has already donated 150 BTC to the BTCUSD Options insurance fund.”
– The OKEx Team