S&P 500 options are the hottest bet on this Hyperliquid exchange

Hypercall, an exchange built on Hyperliquid, says most of its $640 million in volume since June has come from the index.

Talk about options on the S&P 500 index, and you are discussing a beast of a market that trades trillions of dollars in notional volume every day. Crypto traders now appear to want to access it over a blockchain.

Hypercall illustrates the demand. The options platform built on Hyperliquid, the eighth-largest blockchain by total value locked (TVL), went live in June, and more than 80% of the $640 million in notional volume since then has come from S&P 500 options, the exchange told CoinDesk. Open interest, the value of contracts still outstanding, is about $49 million, of which $47 million is in S&P 500 options.

While the numbers are small next to traditional markets and Deribit's crypto options business, which started shortly after the platform’s 2016 debut and now routinely sees billions of dollars in daily volume and open interest, they illustrate a growing trend: the desire to access financial instruments when conventional markets are closed. Hypercall lists daily, weekly and monthly expiries, including over weekends.

"The volume is concentrated in options expiring the following day," Jake Sylvestre, founder of Hypercall, said in an email interview. "Traders can take a view on the next day's move or hold a position further out."

Traders are gravitating to blockchains for exposure to traditional markets, including derivatives. Hyperliquid’s decentralized exchange (DEX), also known as Hyperliquid, has become a go-to venue for placing trades and managing risk through perpetual futures, especially on weekends when conventional markets are closed and geopolitical tensions have repeatedly escalated.

Hypercall takes Hyperliquid’s perpetual futures into the options arena. An option is a contract that pays out if an asset ends up above or below — depending on the details — a set price by a specified date. A call option pays off when the asset finishes above that price at expiry. A put option works the other way round. Traders use both to hedge against price swings and bet on direction, volatility and time.

Each Hypercall contract has a $1 multiplier, which means each index point is worth $1 at settlement. A call with a 7,000 strike pays $100 if the index settles at 7,100. Contracts settle in USDC, a dollar-pegged stablecoin, against the average price over the final 30 minutes for Hyperliquid's S&P 500 perps.

Trading around the clock is the draw. "Hyperliquid has become the best venue for trading these markets outside exchange hours," Sylvestre said.

Hypercall’s exchange's market makers, the firms that quote prices, "hedge on Hyperliquid's perpetual futures, including on weekends when the cash equity market is closed," Sylvestre said. Earnings, economic data and company news can move an underlying asset while its home exchange is closed, and makers "have to price those events around the clock."

Hypercall isn't pitching itself as a replacement for Deribit, the Coinbase Global COIN-owned biggest crypto options venue, which mostly lists bitcoin BTC$83,347.82 and ether ETH$2,501.52 options.

"Most of our traders aren't leaving Deribit; they're trading markets Deribit doesn't list," Sylvestre said.

"We haven't named them publicly yet and expect to over the next few weeks," Sylvestre said. "User collateral is held on-chain," it said, but "order matching is off-chain only." Parts of margining and liquidation also run off-chain.

Index options aren't the only draw. Options on SpaceX SPCX, Nvidia NVDA, Micron Technology (MU) and SanDisk (SNDK) make up more than half of all trades, followed by Apple AAPL, Microsoft MSFT, Meta META, Alibaba (BABA), ether and bitcoin.

Other platforms are adding stock options too. Bybit began offering 24/7-trading on options on stock perpetuals on Sept. 17, starting with SpaceX and Nvidia. Binance, the largest crypto exchange by value traded, offers options on more than 1,000 U.S. stocks and ETFs to eligible users outside the U.S.

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