Options interest refers to the total number of outstanding options contracts that have not yet been settled or exercised. This metric provides insight into the open positions in the options market, indicating the level of activity and speculative interest in a particular underlying asset. A high level of options interest can suggest significant market participant engagement and potential for future price movements.
Context
In cryptocurrency markets, options interest is closely watched as an indicator of sentiment and potential volatility for underlying digital assets like Bitcoin and Ether. News often focuses on spikes in options interest preceding major price events or as a gauge of institutional hedging strategies. Key debates involve the correlation between options interest and spot market movements, as well as the potential for options expiry dates to influence short-term price action.
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