What Is the Primary Advantage of the Early Exercise Feature of an American Option?

The primary advantage of the early exercise feature is the flexibility it grants the option holder to capture intrinsic value immediately. In traditional finance, this is often used to capture dividends before the ex-dividend date.

In crypto, it allows a trader to lock in profits or mitigate further losses at any optimal point before the expiration date, which is especially valuable in highly volatile markets or when anticipating a major market event.