Bitcoin options and futures became one of the most appreciated assets in the crypto market due to their diversification possibilities. Launching BTC futures in 2017 and options in 2020 by the Chicago Mercantile Exchange (CME) was a significant event for investors and traders, as they could leverage Bitcoin’s price dynamic without owning it.Each category has something unique. BTC options allow users the right to buy or sell the underlying asset, while futures work through an obligation to settle the contract. While this may seem like a disadvantage, professionals can make the most of these contracts by using control strategies like the stop-loss order to prevent the consequences of rising or falling prices, whereas choosing how to buy Bitcoin can help manage your portfolio better.Thus, the debate between options and futures continues, as each category benefits a certain audience. But are options better than futures?What makes Bitcoin options lucrative?Bitcoin options stand in the category of financial derivatives through which users have the right to buy or sell Bitcoin at a strike price (a specific amount), within a certain time frame before the contract expires. The first step in owning an option is buying a premium, which is the cost of opening a position.Working with options instead of straight-up Bitcoin allows users to settle a speculative position on whether the market will go up and down, so they don’t need an intermediary for the transaction. While this is a huge advantage, investors should still learn about how to read the room in options by the following terms:The Delta phrase signifies the sensitivity of the option’s price;The Gamma term measures the movements of the options;The Theta term shows how an option’s price decays over time;Trading Bitcoin options efficientlyUsers can trade BTC options for speculating on the coin’s price or to hedge against any risk on the market. That’s why speculative traders must adopt a different approach to capitalize on volatility. This could be buying and selling the same number of Bitcoins with the same strike price and expiration date to ensure a net profit.The method for hedging is known as a covered call, in which traders sell, or write a call option equivalent to the number of coins they already own. It offers the chance to offset some losses in the case of a market price decline, whereas a growth of the market requires selling the holdings.What about Bitcoin futures?Bitcoin futures offer the same chance to gain exposure to the underlying asset without holding it, just like options do. However, the difference lies in the obligation to buy or sell BTC. The contract between two traders states the terms for when it expires, including the amount of BTC to be traded for a particular dollar amount. These contracts can be:Standard: the traders agree to buy or sell the specific BTC amount at a certain price and date;Futures ETFs: the partial ownership in the investments is handled by managers;Perpetual futures: traders can see the target price for BTC without having to repay the other party at a specific time;Benefits of Bitcoin futuresWhile they seem overwhelming to navigate, getting a hold of Bitcoin futures offers several advantages, such as the opportunity to open long or short positions. This makes profit achievable even in price declines through short contracts. Moreover, traders have easy access to leverage, so they can borrow funds to adjust their positions.But the disadvantages of BTC futures should make traders more cautions:There might be high fees involved compared to buying only Bitcoin;Futures are less intuitive to navigate, so beginners can be confused when operating them;The high leverage chances also increase liquidation risks, for which they need a maintenance margin;Who should trade Bitcoin futures and options?Those interested in diversifying their portfolio with futures and options should take small steps in approaching them. Generally, new investors and traders might choose BTC options since they carry lower risks due to the maximum loss being capped at the premium they pay upfront. When buying options, users have the right but not the obligation to fulfil their contract, and they also benefit from the flexibility to exercise these rights before expiration.Therefore, Bitcoin futures might be more suitable for experienced traders. The contracts include the obligation to buy or sell the underlying asset, with higher risks coming from an unlimited potential for profit and losses. Futures are also margin-based, involving the deposit of a small fraction of the total contract value. This exposes the trader to the risk of the market moving against their position, requiring additional funds to keep the trade open.Are there other cryptocurrency derivatives other than Bitcoin?Although Bitcoin was met with enthusiasm from global traders, the CME Group expanded its contracts towards altcoins, which come with more interesting features. Some of these include:Ether, the native token of Ethereum, is one of the most successful blockchain technologies. traders can leverage Ether futures, Micro Ether futures, and options to gain capital efficiencies;SOL, the coin linked with the Solana project, is a promising Ethereum competitor. SOL and Micro SOL options and futures are available for flexible trading;XRP, the native token of the open-source XRP Ledger that comes in XRP and Micro XRP futures and options;ADA, the coin of Cardano, is a peer-reviewed project that aims to improve the industry. Traders can access ADA and Micro ADA futures;LINK, the native coin of Chainlink, is a decentralized oracle platform. The assets available include futures of LINK and Macro LINK;Lumens, the coin present in the Stellar blockchain that facilitates low-cost cross-border payments. Traders can leverage Lumens futures and Micro Lumens futures in a regulated ecosystem;Final considerationsBitcoin options and futures helped cryptocurrencies gain more exposure to innovative assets in a safe, regulated environment. These assets offer the chance for increased leverage, so traders can control their positions better while managing their finances. While options are a safer approach for beginners, considering their lower risks, futures are best for professionals who can manage the margins and are wary of the liquidation risks. Besides Bitcoin, altcoins like Ether, XRP, and Lumens contribute to diversification.