When IBIT options launched in November 2024, two distinct pools of market participants began pricing Bitcoin risk on parallel markets. Within months, the “TradFi” regulated
US product reached $53.3 billion in peak open interest, rivaling Deribit, the dominant crypto-native derivatives exchange, which itself approached $50 billion ahead of December 2025. The joint research found the Bitcoin options are no longer priced only on crypto rails.
MerQube, a US-based technology provider specializing in the design and calculation of innovative, rules-based investment strategies and Kaiko, the global leader in digital asset market data, pricing, and indices, today published the first comprehensive cross-venue analysis of how these two markets priced the same underlying asset across 2025, and what their convergence reveals about the structure of institutional Bitcoin options - as Bitcoin volatility pricing is increasingly priced across both regulated TradFi and native crypto markets.
A Market That Grew at Record Speed
BlackRock’s IBIT redefined expectations for regulated Bitcoin products in 2024, options on this product followed suit. IBIT ETF options reached a peak of $53.3 billion in open interest. With both crypto and traditional markets now operating at comparable scale, how each price's risk has become a practical concern for institutional options desks.
Regulation as a Convergence Catalyst
Structural and regulatory changes drove much of the market's evolution. The SEC raised IBIT position limits tenfold, from 25,000 to 250,000 contracts, in July 2025. The introduction of FLEX options and growing regulatory clarity around supervised institutions' participation in digital asset markets expanded the participant base and deepened liquidity within a concentrated window.
IBIT's call-to-put ratio moved from 4.3:1 at launch to 1.8:1 by year-end, touching 1.56:1 during the April tariff shock, a progression that reflects a market that evolved from directional speculation toward genuine hedging within a single calendar year.
Two Markets, One Direction
The research finds that pricing patterns in the two markets or “volatility surfaces” across Deribit and IBIT largely converged by late 2025, after diverging significantly for much of the year. At-the-money implied volatility, or likely anticipated size of Bitcoin’s next move tracked closely across both venues throughout 2025. However, differences in the skew gap, or premium traders were paying for Bitcoin crash protection peaked on July 1, with IBIT at 33.4% versus Deribit at 18.1%. This closed to within 0.2 points by late September. The December year-end unwind occurred in lockstep across both platforms, a signal that price discovery is now functioning across the TradFi/crypto divide. Late 2025 also produced a notable reversal: Deribit skew briefly exceeded IBIT skew for the first time, suggesting that as TradFi infrastructure matures, the structural crash-risk premium may be migrating toward the crypto-native market.
What the Gap Reveals
Through most of 2024 and into mid-2025, IBIT priced crash protection at a significant premium to Deribit, reaching nearly double the relative downside premium at its peak. Practitioners relying on Deribit volatility surfaces as a proxy for IBIT risk during that period were working with a meaningful gap in tail exposure pricing.
However, whilst structural differences between the two venues, including trading hours, exercise style, and settlement mechanics, remain relevant factors in how risk is measured and managed across platforms the more recent convergence of the two platforms signals a significant move in the ways Bitcoin risk is being priced with institutional or Wall Street investors having as much influence as crypto native players
"The speed at which IBIT scaled to rival Deribit in open interest is without precedent for a regulated US options product. Whilst this research shows scale alone does not create uniformity: these two venues still reflect different participant bases, regulatory environments, and structural mechanics. Practitioners need to account for that when building volatility / option strategies whilst also reflecting that institutional investment at scale always has an influence and -Bitcoin risk is now no longer priced solely on crypto-native rails." said Uday Goel, Global Lead, Research & Origination at MerQube.
"As institutional participation in Bitcoin options grows across both regulated and crypto-native venues, understanding how each market prices risk is essential for robust portfolio construction. With IBIT options reaching $53.3B in peak open interest in under a year, this research shows how quickly regulated and crypto-native Bitcoin options markets have become comparable," said Thomas Probst, Research Analyst at Kaiko.
Read the Full Research
The full research paper is available here: https://www.kaiko.com/resources/report-measuring-risk-in-crypto-options . For more on Kaiko's institutional data and analytics capabilities, visit kaiko.com.
