Introduction to the Hegic Protocol

We have witnessed an explosive growth in the cryptocurrency options market in 2020, as the market structure of centralized exchanges for options trading is maturing. The aggregated open interest of Bitcoin and Ethereum options have recently broken all-time highs at $12.2 billion and $3 billion, respectively, on February 21, 2021.

Despite growing interest in the options market, most volumes were registered on centralized exchanges. Even among centralized exchanges which offer options trading services, Deribit constitutes the majority of the volume. After operating for years, Deribit was forced to cut off users in certain jurisdictions from accessing their platform and has recently introduced a mandatory KYC verification policy for all users.