Binance has unveiled plans on adding Litecoin (LTC) options to its trading platform owing to large demand. On Nov. 24, 2020, Binance had officially announced that LTC contract trading will go live from Nov. 25 at 7:00 AM (UTC). Options trading enables investors to buy or sell a digital asset at a predetermined price either before or on a particular date. As with any other options contract on trading platforms, the expiry date will range from 10 minutes to 24 hours. Although the time range is quite shorter than the traditional options, it can be executed at any time before the expiration date.
Litecoin (LTC) Options Contract on Binance
Cryptocurrency exchange Binance will offer options contracts for the world’s seventh-largest cryptocurrency, Litecoin. Litecoin is the 7th largest cryptocurrency by market capitalization and the platform’s sixth options contract listing.
— Binance (@binance) November 24, 2020
Binance is known for its massive ecosystem, large user base, as well as a great selection of supported cryptocurrencies and virtual assets available for trading. However, its users are constantly requesting more to be added. Hence, Binance stated that the biggest reason for adding Litecoin options is its response to user demand.
Options Trading as Risk Management Strategy
Binance noted that options are an important hedging tool, particularly in times of booming price rallies. It allows traders to purchase or sell an asset at a predetermined price and do it before or on a specific date.
Options are mainly used as a risk management strategy. When traders or investors are hedging, they are trying to protect their investment from events that could have a negative impact on it.
The new listing will not be only available on the website, but also the latest version of the Binance app. The price of Litecoin is currently at $88.12, 2.82% lower than 24 hours ago. However, its performance based on a weekly basis has been quite positive, growing from 20.64% in a week alone.