Kraken, the cryptocurrency platform, has launched options outside Europe and the U.S. and is aiming to expand into Europe.

On 16 July 2026 Kraken said in a statement that it is launching European-style, cash-settled options on bitcoin and ether for eligible professional and institutional clients on Kraken Pro.

Alexia Theodorou, director of derivatives at Kraken, told Markets Media that the firm has been thinking about entering the options market for a long time. She added: “We always believed that demand for options would be there with more institutional adoption of crypto.”

Theodorou said Kraken is one of the few crypto exchanges to have a MiFID license, as it has been approved by regulators in the European Union.

“We want to capitalize on that and move crypto options into the regulated sphere in Europe, which is where we are focused next,” she added. “We don’t have definitive plans yet for options in the U.S. where we are concentrating on perpetual futures.”

Kraken built the technology for the new business in-house which included the exchange, a risk management system and a front-end for users, which Theodorou said was a” very big” investment. She continued that the firm accelerated development in the last few months as crypto options have taken more market share.

The new options contracts are linear and settled in US dollars, with premium, profit and loss, and settlement denominated in fiat currency. The first phase of the options launch only offers trading via request-for-quotes (RFQs) but Theodorou said the intention it to move towards a public order book to deepen price discovery as activity scales, alongside broader geographic access and wider asset coverage.

Portfolio margin is enabled for every eligible client by default rather than as an opt-in tier, and offsetting positions reduce overall margin requirements. Spot, futures and options sit in a single unified wallet, which Theodorou believes is a differentiator, alongside the design of the contracts. Clients can post collateral in more than 30 different currencies, drawing on the same multi-collateral pool that supports Kraken’s existing derivatives offering.

“We spent a lot of time optimizing capital efficiency for options while ensuring that the risk engine is not compromised,” she added. “Portfolio margining keeps us competitive when it comes to capital efficiency, which is very important to institutions.”

Theodorou said there is a lot of demand from market makers and institutions, and many active discussions are in the pipeline.

Crypto derivatives growth

Kraken said the launch of options is the first phase of a long-term build as activity in crypto is set to track toward levels seen across traditional derivatives markets.

Wei Liao, director of derivatives market intelligence at Cboe Global Markets, said in a report that between 2024 and early 2026, the crypto market has been through a structural transformation. Liao said in the report: “What had functioned as a retail-led and speculative market became more institutional in ownership, more intermediated in trading, and more closely integrated with traditional financial infrastructure.”

The report, Beyond ETFs: How Derivatives & Tokenization Are Reshaping Crypto, said that by May this year, total crypto market capitalization had fallen roughly 40% below its October 2025 peak to about $2.49 trillion. However, Liao argued that this was different from prior cycles because of support from deeper institutional participation, more developed derivatives markets, broader ETF adoption, and a larger base of stablecoin liquidity.

Annual notional derivatives volume in 2025 reached roughly $111.5 trillion across crypto-native centralized exchanges (CEXs), crypto-native decentralized exchanges, and traditional finance (tradFI) venues, including futures-style derivatives and options, according to the report.

“That compares with spot turnover of about $25.3 trillion, implying a derivatives-to-spot ratio of approximately 4.4x — up from 3.5x in 2023 and less than 1x before 2020,” added Cboe.

In the options market, Cboe said Deribit remains the leading crypto-native venue for non-ETF options volume, reflecting its long-standing role as a primary offshore options liquidity hub. Deribit was acquired by U.S.-listed crypto exchange Coinbase in August last year.

At the time of the  acquisition, Coinbase said Deribit would bring the firm closer to offering the full spectrum of trading products across spot, futures, perpetuals, and options on one platform, to scale globally with broader participation and offer deeper liquidity.

Alesia Haas, chief financial officer of Coinbase, said on the first quarter results call this year that Deribit was the “clear leader” in terms of institutional clients and professional market makers trading options and the firm was very focused on the integration. She added: “It is progressing nicely and we expect to be fully integrated in 2026.”

Emilie Choi, president and chief operating officer of Coinbase said on the first quarter results call that lower volatility, reduced hedging demand, specifically at Deribit, and options activity declined following record volumes in the fourth quarter. Choi added: “Deribit open interest share held steady despite that headwind and we feel that the durability of positioning is still very much intact.”

Cboe’s report said regulated options tied to spot ETFs,  particularly the iShares Bitcoin Trust (IBIT),  have grown quickly, creating new channels for volatility trading and hedging on tradFi venues. Crypto-native centralized exchanges and TradFi venues together accounted for roughly $3.1 trillion in crypto options notional in 2025, split between about $1.94 trillion on CEXs and $1.17 trillion on regulated venues.