Although derivatives make up the majority of crypto trading volume, options remain a relatively small corner of the market, dominated by a few established exchanges such as Deribit, CME Group, and Binance. New entrants increasingly see options becoming more widely adopted as digital assets become institutionalized.
The move is the latest step in Kraken’s transformation from a crypto exchange to a broader financial platform offering trading, payments and other digital asset services.
Grow the market, not just market share
Theodore believes the big opportunity is to expand the addressable market by making options easier to use, rather than just focusing on taking market share from existing markets.
“The existing options market for cryptocurrencies is built to target a small group of traders,” Theodore said.
“Our service expands access through easy dollar settlement contracts in the same accounts customers already use for spot and futures,” she added.
A retail-first approach
According to Theodore, the slow growth of cryptocurrency options is more a product design issue than a demand issue.
“The gap in crypto options is not demand, but design,” Theodore said.
He points out that while existing crypto options platforms primarily cater to institutional investors and market makers, retail traders are instead gravitating toward perpetual futures, whose relative simplicity has made them the dominant speculative product in the industry.
