Crypto options are quoted in volatility terms for good reasons — set out in why crypto options are quoted in volatility. One side effect is that the bid-ask looks small.
A market a couple of volatility points wide sounds tight. Converted into premium on a short-dated, low-priced option, those same points can be a substantial percentage of what the option costs.
Why the conversion matters
Because the spread is charged twice — once entering, once exiting — and it is charged on the premium, not on the volatility. A trade that must overcome a wide round trip needs a much larger move to break even, and a strategy that trades frequently pays it every time.
The general point is the same as the bid-ask spread in any market. What is specific here is that the quoting convention obscures it: the number you see is not in the units the cost is paid in.
Where it is widest
Exactly where liquidity is thinnest — far from the money, on minor expiries, and on the smaller coins. Which is also where the cheapest-looking options are, so the options that appear most affordable routinely carry the highest percentage cost to trade.
That is the trap worth naming: low absolute premium reads as low risk and often means high transaction cost against a low probability of paying out.
Mark price is not a tradeable price
Chains display a mark, and it is the venue’s fair-value estimate — the same mark versus last distinction that governs margin on perpetuals. It sits between bid and ask and is not a price anyone will trade with you.
Valuing a position at mark is correct for accounting and optimistic for planning. The realistic figure for what you could exit at is the bid, in the size you actually hold.