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What is the difference between spot price and strike price in the context of cryptocurrencies?

avatarbestsniperDec 16, 2021 · 3 years ago3 answers

Can you explain the distinction between spot price and strike price when it comes to cryptocurrencies? How do these two terms differ and what role do they play in the cryptocurrency market?

What is the difference between spot price and strike price in the context of cryptocurrencies?

3 answers

  • avatarDec 16, 2021 · 3 years ago
    The spot price of a cryptocurrency refers to its current market price, which is determined by supply and demand. It represents the price at which a cryptocurrency can be bought or sold immediately. On the other hand, the strike price is a predetermined price at which a cryptocurrency option contract can be exercised. It is set when the contract is created and remains fixed until the contract expires. In simple terms, the spot price is the real-time price of a cryptocurrency, while the strike price is the price at which an option can be exercised.
  • avatarDec 16, 2021 · 3 years ago
    Spot price and strike price are two important concepts in the world of cryptocurrencies. The spot price is the current market price of a cryptocurrency, which constantly fluctuates based on market conditions. It is the price at which you can buy or sell a cryptocurrency instantly. On the other hand, the strike price is the predetermined price at which you can buy or sell a cryptocurrency in the future, as specified in an options contract. The difference between the spot price and the strike price determines the profitability of the options contract. If the spot price is higher than the strike price, the options contract is considered profitable.
  • avatarDec 16, 2021 · 3 years ago
    Spot price and strike price are terms commonly used in the cryptocurrency market. The spot price refers to the current market price of a cryptocurrency, which is determined by buyers and sellers in real-time. It represents the price at which a cryptocurrency can be bought or sold immediately. On the other hand, the strike price is the price at which a cryptocurrency can be bought or sold in the future, as specified in an options contract. The strike price is fixed when the contract is created and does not change. The difference between the spot price and the strike price determines the value of the options contract.