Down-and-In Option

A down-and-in option is a type of knock-in barrier option where the barrier is set below the current market price of the underlying asset. The option does not exist until the asset price falls to hit or cross the lower barrier.

Once activated, it becomes a standard option for the remaining time to expiration. This instrument is often used by traders who anticipate a potential price correction and want to enter a position only if that correction occurs.

It serves as a way to gain exposure to lower price levels at a reduced initial cost compared to buying a standard put or call. In the context of crypto, it allows for strategic entry points into markets that are expected to test support levels before a potential recovery or further decline.