Who is afraid of crypto derivatives? | Opinion

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Stock trading and investment are never meant for the faint of heart, but one can certainly ease into them without losing their head and hard-earned money.

Blue-chip fiat investing is established, is typically easy to understand, and has many avenues where traders can ask for help. It might be slightly boring and slow to grow if only investing in reliable, “sure thing” stocks, but they’re still relatively approachable.


Derivatives such as futures or options ramp up the intensity, as the investments become more speculative and complex—even more so than just looking at numbers on the screen.

The earning potential here is incredibly vast, but so is the potential for loss. This is why derivatives are usually left to institutional investors or experienced traders who have a better grasp of how to navigate these sectors and, to say it plainly, are better equipped to lose their investment.

Now, imagine throwing crypto into the mix here.

Crypto derivatives are not a new concept, and many leading exchanges and platforms have launched services for experienced traders to try their hand at it. However, entering a speculative market dealing with notoriously volatile assets is not so easy. And just because someone has found success in futures and options trading in fiat doesn’t mean the same fortune will befall them in crypto.

Simply put, crypto derivatives are frightening to the average trader. But is there any way to make it less intimidating?

Fiat investment services have only become more accessible with the rise of mobile-first products that use simple and understandable language to guide newcomers. Any sensible financial advisor at a retail bank will also likely advise clients to store funds in an investment account rather than a traditional savings account, solidifying legitimacy that gives people a sense of security.

Plenty of blockchain-based services attempt the same thing, but the success has been middling.

Any way you slice it, crypto will always have a more daunting learning curve than fiat currencies due to how the technology and market function. And in most cases, someone interested in crypto can’t simply walk into a bank and get sound advice on derivatives trading strategies.

Making crypto derivatives more approachable requires a clear push in both education and creating services that don’t require a doctorate to operate.

Projects such as Thalex, for instance, have made this their mandate. Thalex is an exchange specializing in crypto derivatives, namely in perpetuals, futures, and options, but its no-frills approach serves its mission to remove the friction from trade ideation to execution and to empower traders by offering tools that help even out the playing field.

Likewise, Thalex offers a “paper trading” platform. This enables those interested in its platform to test out its services and try out trades before going live—creating an environment where users can learn the ropes on crypto derivatives.

Futures and options aren’t an impossible concept to grasp, but the unpredictability and lack of education on how they work in crypto make investors less inclined to explore them. To overcome this fear of crypto derivatives from fiat and crypto traders alike, there has to be a way to soften the landing. Not only will this help make the pros and cons of derivatives trading clearer, but also help create a roadmap that traders can feasibly follow.

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