Unprecedented! $BTC options positions crush futures for the first time, Wall Street's "new anchor" is set, on-chain covert battle on the brink of eruption!

Many people may not realize that the cryptocurrency options market has grown to an unimaginable size. The trading volume of crypto derivatives on the Chicago Mercantile Exchange (CME) has surpassed its peak from last year by 46%. Institutions need tools to manage their billion-dollar positions, and options are currently the only crypto instrument that can provide precise risk exposure definitions.

The landscape is being reshaped. By mid-2025, the total open interest in $BTC options reached $65 billion, surpassing futures for the first time in history. Futures are inherently leveraged, while options allow funds to pay a premium to set a clear loss limit for a $500 million $BTC position. This turning point indicates that tools with risk definition capabilities are gradually replacing pure leverage instruments.

Growth mainly comes from two platforms. Deribit has been the main battleground for crypto options trading for years. After being acquired by Coinbase for $2.9 billion in 2025, it gained institutional-level credit backing. Meanwhile, IBIT options, launched at the end of 2024, have brought traditional financial capital directly into this space. The options market is expanding rapidly, but most trading still relies on intermediaries. On-chain options are still in their infancy.

Decentralized derivatives’ market share has increased from 2% to over 10% in two years. Hyperliquid has proven that DEXs can match centralized exchanges in speed and transparency. However, there are still no flagship projects at the same level in the on-chain options space.

@DeriveXYZ remains the leading on-chain options protocol, with over $700 million in nominal trading volume in the past 30 days. It was launched in August 2021 as Lyra, an options AMM. After a bear market, it was fully rebuilt in 2023, now based on its own OP Stack Layer 2 with a fee-free central limit order book.

This rebuild has fundamentally changed the pricing mechanism. Market makers quote directly on the order book, narrowing spreads, enabling more precise pricing, and supporting larger trades. Traders enjoy zero gas fees and sub-second execution speeds. Its collateral margin system also attracts institutional attention, as it assesses overall position risk through scenario analysis.

For example, a trader holding both a call and a put option on the same underlying asset won’t be required to post margin for each leg separately. The net risk exposure after hedging requires far less collateral than the sum of individual positions, which aligns with traditional financial derivatives trading logic. Derive also offers perpetual contracts and lending on the same Layer 2, supporting cross-product margining.

@KyanExchange is progressing toward the same goal in a different way. The platform combines an order book matching engine with on-chain portfolio margin, enabling multi-leg strategies in a single atomic transaction. Traders can deploy complex strategies like Iron Condors with just a few clicks.

Kyan’s liquidation mechanism also differs from most DeFi protocols. When margin thresholds are breached, the platform does not liquidate the entire account but executes partial liquidations, closing only the minimum positions needed to restore margin requirements. Kyan is currently in testing on Arbitrum, with mainnet launch imminent.

So, who needs options the most? The answer is asset management firms building structured products. They urgently require the clearly defined risk-reward structures that options provide. For example, JPMorgan’s equity premium income ETF, built on a covered call strategy, is one of the largest actively managed funds globally. Derivative-based income products now manage over $100 billion.

As more institutional capital enters the on-chain space, the need for hedging will also grow. Currently, more institutional investors hold or plan to allocate digital assets in the short term. A notable indicator is that IBIT options’ open interest has surpassed that of gold ETF GLD. By 2025, CME processed $30 trillion in nominal trading volume of crypto derivatives.

The timing is ripe. Many early on-chain options protocols failed, mainly due to regulatory uncertainty. For example, Opyn was penalized by the CFTC for operating an unlicensed derivatives exchange. When developing products, teams couldn’t predict whether their offerings would be deemed illegal in the next quarter.

The situation is improving. In September 2025, the SEC and CFTC jointly issued a statement allowing regulated exchanges to conduct spot crypto asset trading. The CLARITY Act has passed the House, proposing to bring the spot digital commodity market under CFTC regulation. The Senate version is still under discussion and currently on hold.

CME Group will launch 24/7 crypto options trading on May 29. While this doesn’t guarantee on-chain protocols will inevitably win, the overall environment has undergone a significant shift. The groundwork for on-chain options’ explosive growth is quietly being laid.

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