How Does a ‘European’ Style Option Restrict the Exercise Relative to an ‘American’ Style Option?

A European-style option can only be exercised on its expiration date, not before. This contrasts with an American-style option, which grants the holder the right to exercise the contract at any time between the purchase date and the expiration date.

Due to this flexibility, American options are typically priced slightly higher than comparable European options, as the early exercise feature adds value. Most crypto options are European-style for simpler settlement.