Arbitrum (ARB) token derivatives markets are popping up on centralized and decentralized exchanges ahead of Thursday's claims event.
The decentralized marketplace Clober lets traders buy puts on ARBs with strike prices of 50 cents, $1, $2, $4, $8, and $16. These have totaled over $50,000 in trading volume in the last 24 hours of issue.
Put options are a type of option that increase in value if the price of the underlying asset, such as a dollar, falls. B. a token or a share, falls.
“$ARB $2 put options are selling for 54 cents,” Clober said Tuesday. “By paying 54 cents, you can purchase the right to sell your $ARB tokens for $2 at any time within 24 hours of claiming your $ARB airdrop.”
“That guarantees a $1.46 profit per ARB on the day of damage,” added Clober.
The put options have an expiration date of March 24th or one day after the claim event. This effectively means that the options allow traders to bet on the ARB's price action on the first day when the trade goes live.
ARB price action is expected to be significantly volatile on day one. Arbitrum developers confirmed last week that ARB will be airdropped to community members on Thursday, March 23 based on their previous network activity, marking Arbitrum's official transition to a decentralized autonomous organization (DAO).
While the tokens have long been awaited by investor circles to gain exposure to the Arbitrum ecosystem, dynamic price action could occur on the first day of trading as some holders dump their tokens to capture “free” profits while others take longer-term positions.
The spot tokens cannot be claimed or actively traded on any exchange as of Tuesday, but futures products offered by Hotbit and BitMEX are already trading for millions of dollars each day, CoinDesk reported.
ARB futures are very volatile. Hotbit's Arbitrum IOU tokens are down 32% over the past 24 hours, according to CoinGecko data, after hitting highs of $12 on Monday night. On the other hand, BitMEX ARB futures are trading at $1.40 at Tuesday press time.