Binance, the leading crypto exchange by trading volume, has just made it possible for everyone to earn passive income through ether options, opening up a strategy that was previously limited to professionals.
The exchange announced in a press release shared with CoinDesk that it allows users to write (sell) ether options, helping them effectively manage risk and generate additional income. This decision responds to the growing demand from retail and institutional investors for advanced derivatives trading tools.
The announcement is based on Binance’s move towards democratize bitcoin options writing and reflects the explosive demand for BTC, ETH and ETF-based instruments.
The institutional appetite for these products is undeniable; Earlier this year, BlackRock’s IBIT options notably eclipsed Deribit’s native BTC options in volume, marking a pivotal moment for the crypto derivatives landscape.
“Binance remains committed to delivering innovative tools that meet the evolving needs of our users,” said Jeff Li, Vice President of Product at Binance. “The introduction of ETH Options writing and the upgrade of our Options platform will allow traders faster execution, greater flexibility, and richer market data to support more advanced and strategic trading approaches in the growing crypto derivatives space.”
Options are derivative contracts that give the holder the right, but not the obligation, to buy or sell an underlying asset at a predetermined price within a specific time period. These contracts are paid at a later date, depending on whether the price of the asset rises or falls below a designated level.
While the call buyer benefits from price rallies, the seller (writer) takes the opposite view and essentially provides insurance against bullish movements in exchange for an initial premium. This premium serves as immediate income.
Savvy traders have increasingly used this strategy in recent years, writing call or put options on Deribit, often against their coin holdings, to generate income.
Binance users can now do the same with ether options by posting margin to collateralize their obligations, with access contingent on a mandatory suitability assessment to ensure responsible trading.
To incentivize immediate liquidity, Binance is also implementing a steep 20% discount on Taker and Maker fees for VIP users on its newly listed ETH, BTC, BNB, and SOL contracts, a move aimed at cementing its dominance in the competitive crypto options space.
Platform update
In a bid to capture greater share of the derivatives market, Binance has revamped its options platform with a set of infrastructure upgrades designed for high-frequency traders and institutional players.
The revamped ecosystem features significantly higher API performance and lower latency, enabling faster order execution during periods of high market volatility. Beyond speed, the exchange has expanded its available strike prices across multiple assets, offering traders the granularity needed for complex hedging and speculative strategies.
To bolster market transparency, the platform now integrates advanced WebSocket flows, providing deep-level market data essential for sophisticated technical analysis.
