1.The benefits of Cryptocurrencies options
2.Never burst, sleep in peace
What the buyer of option buys is a kind of right, can choose to carry out according to the circumstance at that time or do not carry out this kind of right, won't have so the risk that blows up a storehouse like futures, option also calls right storehouse on professional term.
For example, Tom bought a digital currency option of "btc-call-march-3800". If the price of BTC is lower than 3800 on the expiration date, Tom has the right not to exercise the option in order to reduce the loss. If above 3800, small money also has right to undertake exercise and gain accrual.
Using Cryptocurrencies options, such derivatives can be hedged and hedged. For example, bitcoin miners have a fixed cost for mining the Bitcoin. When the price of the Bitcoin fluctuates too much, miners' earnings cannot be guaranteed. At this time, miners can hedge losses caused by the decline of bitcoin by putting options. It's like buying insurance.
For example, Tom can buy 1000 Cryptocurrencies options of "btc-put- march -3800". If the price of BTC falls to 3600 on the expiration date, Tom can choose to exercise the option and sell a BTC worth 3600 at the price of 3800. At this time, the price drop of BTC brings him 200USDT (ignoring the royalty).
4.leveraging, promote capital efficiency
Larger gains can be made with a small royalty. The premium on an option is usually cheaper than the margin on a futures contract. Options with leverage and will not burst, can reduce the cost of capital, improve the efficiency of capital use.
For example: money is BTC, he felt free as generative, and sold 1000 copies of "BTC –call- march - 4000" to sell, and sells only need 200 USDT 1000 options, so little space will only cost 200 USDT bought 1000 "BTC-call- march-4000" cryptocurrencies options, when the BTC at maturity of more than 4000, the small space the greater the benefits of exercise, if BTC at maturity is below 4000, small space can choose no rights, Tom losses only 200 USDT at this time.
5.leveraging, increase gain
Long-term investors of cryptocurrencies and the buddhist holders can sell (knock out) the subscription options with the help of digital currency options during the holding period, so as to enhance the earnings of holding cryptocurrency. This adds to your savings.
For example: money is cryptocurrencies investors for a long time, he is BTC large and very bullish on this cryptocurrency, he released thousands "BTC – call-march - for - 4000" option to sell, market direction and he expected, BTC itself prices for his benefits, and sell call option premiums will benefit him.