What is strike price?

The fixed price at which an options contract can be exercised.

A call is worth exercising when the market trades above its strike; a put when the market trades below. The distance between strike and current price drives most of the option's value alongside the time left and expected volatility, and options far from the money cost little precisely because they usually expire worthless. Exchanges list a ladder of strikes around the current price for each expiry, and the strikes with the most open interest often cluster at round numbers. See options contract and implied volatility.

Options are a separate market from the spot buying this site tracks, and in most jurisdictions they are separately licensed, so a venue offering you spot may not offer you options.

How it works

An option gives its holder the right, not the obligation, to buy a call or sell a put at the strike before or at expiry. The strike is fixed when the contract is created and never moves.

Value splits into two parts. Intrinsic value is what exercising would be worth right now: for a call, the market price minus the strike, floored at zero. Time value is everything else, and it reflects the chance the option finishes further in the money before expiry. Time value decays toward zero as expiry approaches, which is why an option can lose money while the underlying price is unchanged.

Three labels describe the relationship. In the money means exercising has positive intrinsic value. At the money means the strike sits at the market. Out of the money means intrinsic value is zero and the whole premium is time value.

Crypto options on most venues settle in cash rather than in coins, so exercising an in-the-money call credits the difference rather than delivering the asset. That is stated in the contract specification on the venue's own documentation, and it is the difference between an option position and a spot holding.

Example

Illustrative figures. A call with a $50,000 strike, when the market is at $52,000, has $2,000 of intrinsic value. If the option trades at $3,500, then $1,500 of that is time value. Hold it to expiry with the market still at $52,000 and the time value is gone, leaving $2,000. You paid $3,500 for something worth $2,000, a $1,500 loss, while the underlying price did not move at all. If the market instead expires at $49,000, the call is worth nothing and the whole $3,500 is lost. The strike is what makes those outcomes arithmetic rather than opinion.

Why it matters when you buy

Options are exposure, not ownership, so they do not produce coins you can withdraw and they are unavailable to retail users in several jurisdictions. If holding the asset is the goal, the buy pages show which venues will sell you spot where you live, and the guide comparing an exchange-traded fund with buying Bitcoin directly covers a related choice between exposure and ownership.

Related terms

• options contract — the instrument the strike belongs to
• implied volatility — what the market is pricing in
• derivatives — the category this sits in
• open interest — how many contracts are outstanding at a strike
• spot market — the alternative that delivers the asset
• settlement — how an exercised contract pays out

Questions

Can the strike price change?

No. It is fixed when the contract is created. What changes is the market price around it, which is what moves the option's value.

Why do options at round-number strikes have more open interest?

Because traders coordinate on round numbers when choosing targets, and market makers list them for the same reason. It is a convention rather than a mechanism.

Do I get coins if I exercise?

On most crypto venues, no. Contracts are usually cash settled, so you receive the difference in value. Check the contract specification before assuming delivery.