In this write up, we will focus on non-custodial Ethereum based options.
🚀 Leverage
For every 1% movement up in $ETH, a call option may go up 10%.
🦔 Hedge
Protect your holdings, bet against $ETH with a put option or sell a call for additional income.
Below is an example showing the power of using call options as leverage, the timescale is 3 hours.
Comparing $ETH vs $ETH 3X Margin vs $ETH Call 2
0
Leverage
The focus is on maximizing your returns
👇 Follow the example below:
In this example we illustrate a $100,000 investment and what it would be worth in the future. We compare holding $ETH or an $ETH call. You can change any of the inputs below.
Change Starting Balance:
0000000
100000
Starting Balance: $
100000
Assumption Delta 1% up movement in $ETH = 10% up move in $ETH Call
$ETH Balance Growth ($Dollar)
1
$ETH Balance Growth (%Percentage)
1
Hedge
The focus is on protecting your portfolio during a downturn but not losing all your exposure.
👇 Follow the example below:
Crypto markets have recently fallen 20-30%. Timing the market is a difficult feat to accomplish, however hedging your positions is imperative for long-term growth. In this example we illustrate an 80% long ETH and 20% short ETH utilizing $ETH Puts. We compare a $100,000 investment (100%) in $ETH and a $80,000 investment (80%) and 20% hedge ($ETH Puts). You can change any of the inputs below.
🔴 The below example has $ETH going down 26% over 10 hours.
$ETH 100% vs Hedge 80%$ETH & 20%$ETH Puts (%Percentage) 2
0
Conclusion
If you are a stakeholder in the Ethereum ecosystem, you stand to benefit by having access to a derivative such as options to help you either leverage or hedge your positions.
Next steps:
Prototype
Educational forum
Liquidity Mining Program
Smart Contracts
MVP
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