Deribit has a firm belief in the future of cryptocurrencies, and the important role a liquid option market has in the health and growth of the market as a whole. An options market is comprised of a large number of order books and needs to be capable of handling thousands of requests per second. This is why Deribit has focused so heavily on the underlying technology and developing a platform capable of handling this load.
Product development is also very much centered on what customers will find useful, and indeed it is very common for upgrades to be based directly on customer requests. The telegram group has become an excellent way for traders to have direct access to Deribit staff 24 hours a day and give real-time feedback.
With the recent launch of Ethereum derivatives on Deribit it’s about time we had a look at what else is coming down the pipeline in 2019. So far this year has seen the launch of ETH products (perpetual swaps, futures and options), reduce only stops enabling much more convenient position/risk management and v2.0 of both the UI and API.
So what’s next?
Despite only recently launching v2.0 of the user interface to accommodate new currencies, the next version is already largely developed and should be ready for release in the next couple of months. This will bring a completely customisable layout allowing users to reposition and resize every element of the trading screen. It will also bring a depth chart to the futures and the ability to see the order books, recent trades, current positions and order form on the same page as the option chain without the need for a pop up.
Here’s a sneak peak at the type of screen you will be able to create with the v3 layout. You can create new rows or columns and drag/drop each element wherever you like. And you can even have several elements in the same area using tabs.
And the new option layout will have similar capabilities as shown below.
Mass Quote Protection
There are around 100 different strike price/expiry date combinations on Deribit at any given time, and that’s just for Bitcoin. Then consider that each one of these has both a put and a call, and a bid and ask. That is a lot of instruments that the liquidity providers need to quote on simultaneously.
Mass quote protection allows the market makers to quote larger size on each instrument without being overly exposed to the risk of having every order hit at once. As a simple example say an account is protected for anything over 500 contracts, once 500 contracts of that accounts’ orders have been hit in a given time period the rest of their orders will be canceled, allowing them time to hedge or reposition the rest of their orders accordingly.
This will not only protect the liquidity providers from taking on positions too large for them in a short space of time, but will also allow for considerably better liquidity across the whole option chain which will benefit all traders.
Block Trade Functionality
A block trade helps two parties who wish to transact larger size to do so privately without exposing themselves to risk on the public order book. They both agree on a price and this is then executed in full without the need for either party to place the order on the order book. This will make the process of executing large privately arranged trades considerably easier.
The more information available to traders the better decisions they can make. With this in mind, Deribit is developing a separate analytics website that will offer a range of new tools based on live data from Deribit. This will include volume, option statistics, historical funding data, equity charts and volatility data. The analytics site will provide all traders with useful data that is relevant to their trading decisions.
Educating users on how to use the platform and also how to trade the derivatives on offer is extremely important to Deribit. Derivatives can have a steep learning curve, particularly options. The goal is to create an education resource that will make Deribit accessible and easy to use for as many people as possible. Reducing any barrier to entry by providing all the resources anyone could need to get the most out of the platform.
Additional Currency Listings
While bitcoin is still king in the cryptocurrency space with a market share of around 50% at the time of writing, there is a serious and growing demand for additional currencies. The ETH product development brought with it several important upgrades. The new user interface and API have now moved from being a single currency system to supporting multiple currencies. This means adding more currencies in future will be a more streamlined process.
Advanced Order Types
Deribit users already have access to limit orders, market orders, stops (both limit and market), post only, hidden and reduce only order types. But more advanced order types are also planned for the future. Advanced order types such as One Cancels Other (OCO) and trailing stops will give traders even more flexibility in how they structure their trades, and more freedom to step away from the screen knowing their orders will execute exactly as they intend.
The Future On Deribit
With these upcoming features and continued development Deribit intends to remain at the forefront of the crypto derivatives market by giving traders all the tools they need.
And it’s not just the platform itself that is being improved. The Deribit team is also continuing to expand, providing support in more languages, expanding into new markets and developing strategic partnerships and integrations with other companies and software providers.
2019 has been a very successful year so far and there is plenty more to come in the very near future.