Open interest in XRP options is close to $ 100m because high volatility takes yield hunters
The dollar amount locked in open XRP options that contracts listed in the derivit quickly climb a record because the highly indicated volatility of the token gets yield hunters.
The so -called notional open interest (Hey) has risen to nearly $ 98 million from $ 71 million since June 27 quarterly expiry, a solid 38% increase in two weeks. It is close to June 24 records of $ 102.3 million, according to Data derivit metrics. In the terms of the contract, the OI rose 26% to 42,414. (The Multiplier of the contract for XRP in the deribit is 1,000 XRP).
Behind the increase is the indicated volatility of the token, a measure of the expected price swings at a certain time. XRP is taller than Bitcoin
Ether and Solana, according to Lin Chen, head of derivit business development.
“The XRP has delivered an annual return of more than 300% in the last 12 months,” Chen told CoinDesk. “Its choices also gain significant popularity, which can be seen in the highest indicated volatility in the major tokens – indicating strong investor demand.”
One way entrepreneurs make the acquisition is by selling cash-secure puts, Chen said. Writing a choice to put – it is up to buy the owner at a prescribed price – is similar to the sale of insurance against price drops in exchange for a premium, which represents the return of the seller.
Traders usually write options against handling markets or in a “cash-secure” manner when the volatility is highly indicated. The higher the volatility, the cheaper the options and the opposite. The cash-secure version involves handling enough stablecoins to ensure that the underlying property is purchased if the price slides and the buyer decide to use their right to sell the property at the predetermined price.
Risk returns skewed bullish
As with the time of writing, the 25-Delta Risk Reversals are positive, indicating a bias towards call options, or bullish bets, according to the data monitored by Amberdata.
The 25-Delta Risk Reversal is a approach consisting of a long position and a short call option (or vice versa) With a 25% delta, that means both options are quite far from the underlying asset market price.
Pricing for risks to entire tenors helps to recognize market feelings, with positive values representing a relative -child wealth of calls and negative values that indicate a downside bias. At the time of press, short-term returns to XRP risk and those tied to August and September expirations are positive.
In addition, more than 30 million calls are turned on, releasing 11.92 million placed, giving a put-call ratio of 0.39, also a sign of bullish sentiment on the market.
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