Crypto glossary
Strike price
The strike price is the fixed price at which an option holder can buy (call) or sell (put) the underlying asset, deciding if the option ends in profit.
Every option contract specifies a strike price. A call gives the right to buy the underlying at that price and a put the right to sell at it. On crypto venues such as Deribit, strikes are listed at regular intervals, for instance every 1,000 or 5,000 dollars for bitcoin, across several expiry dates.
The relationship between strike and current price defines moneyness. A call is in the money when the market is above its strike, at the money when both are roughly equal and out of the money when the market is below; for puts it is the reverse. Moneyness drives how much intrinsic value an option has and how traders read positioning around large strikes before expiry.
Choosing a strike is a trade-off. Deep out-of-the-money options are cheap but expire worthless most of the time, while in-the-money options cost more and behave closer to holding the asset. Strikes with heavy open interest can attract hedging flows near expiry, but they do not guarantee where price will settle.
Example
A trader buys a bitcoin call with a 100,000 dollar strike; if BTC settles at 108,000 dollars at expiry, the option is worth 8,000 dollars per coin before subtracting the premium paid.