Binance opens up ways for users to generate income using ETH options

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coindesk
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9 hours ago


What to know : Binance has opened up ether options to all users, allowing them to earn passive income, expanding a strategy previously limited to professional traders. The exchange's move responds to growing demand for advanced derivative tools from both retail and institutional investors. Binance has upgraded its options platform to offer faster execution and greater flexibility, aiming to dominate the competitive crypto options market.

Binance, the leading crypto exchange by trading volume, has just made it possible for everyone to earn a passive-like income through ether options, opening up a strategy once limited to pros.

The exchange announced in a press release shared with CoinDesk that it is allowing users to write (sell) ether options, helping them effectively manage risk and generate extra income. This decision responds to increasing demand from both retail and institutional investors for advanced derivative trading tools.

The announcement builds on Binance’s move to democratize bitcoin options writing and mirrors 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," Jeff Li, VP of Product at Binance, said. "The introduction of ETH Options writing and our Options platform upgrade will empower traders with 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 provide the holder with the right, but not the obligation, to buy or sell an underlying asset at a predetermined price within a specific timeframe. These contracts pay out at a later date, depending on whether the asset's price rises above or falls below a designated level.

While the call buyer profits from price rallies, the seller (writer) takes the opposing view, essentially providing insurance against bullish moves in exchange for an upfront premium. This premium serves as immediate income.

Savvy traders have increasingly used this strategy over the past couple of years, writing calls or puts 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 rolling out a steep 20% discount on both Taker and Maker fees for VIP users across its newly listed ETH, BTC, BNB, and SOL contracts—a move aimed at cementing its dominance in the competitive crypto options space.

Platform upgrade

In a bid to capture a larger share of the derivatives market, Binance has overhauled its options platform with a suite of infrastructure upgrades designed for high-frequency traders and institutional players.

The revamped ecosystem boasts significantly higher API throughput 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 streams, providing the deep-tier market data essential for sophisticated technical analysis.

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