Why Are European-Style Options More Common than American-Style in the Crypto Options Market?

European-style options are dominant primarily due to their simpler valuation. The lack of an early exercise feature means they can be accurately priced using models like Black-Scholes without complex numerical methods.

This simplicity makes them easier for market makers to quote and hedge, resulting in tighter spreads and deeper liquidity. Furthermore, the early exercise feature is often only valuable when the underlying asset pays a dividend, which is not a factor in cryptocurrencies.