12 ms·

You completely ignored what GP said. The floor is different from what people will sell it to you for right now. AMZN may have a floor of $ASSETS / #SHARES (or

by dmoy 4y ago

You completely ignored what GP said. The floor is different from what people will sell it to you for right now. AMZN may have a floor of $ASSETS / #SHARES (or something, I just made that up), but that doesn't mean anyone will sell it to you for that right now.

uoaei 4y ago
It's like any other investment option, in that it's basically a legalized bet with contract language enforcing it.
hinkley 4y ago
That’s just the sort of definition of Floor that leads to internet breaking production outages.
- benreesman 4y ago
  Thank you.
benreesman 4y ago
Anyone can invent quasi-financial terms to make grandiose claims. The beauty of the market is that loudmouths don’t participate in the market for long. I’ll sell an American-style options contract to someone who thinks BTC is going anywhere near there at Black-Scholes -75. And I’ll have no trouble financing it. You want the other side?
- joebob42 4y ago
  I don't think "is this where the price is going" really has anything to do with what gp was even saying.
- pcthrowaway 4y ago
  I'm pretty bullish crypto but I think there's a chance Bitcoin hits $1000 again in the next 10 years or so.. mainly because I think the case for Ethereum is much better. I don't understand what Black-Scholes means, but if you're willing to take 10 to 1 odds in my favour I'll draw up a smart contract: we both deposit USDC and receive tokens for our position which can be resold if desired; if bitcoin hits $1000 or less according to the Chainlink BTC_USD oracle at any point between now and 10 years from now, I get 10 USDC for every one of mine wagered
- px43 4y ago
  Shh.. you're scaring all the people who think their computer science degree gives them exceptional insight into how money works.
  - benreesman 4y ago
    In fairness, I was one of those people until I landed at a satellite office of my SV company in New York and started hanging out with real finance players.
- mattnewton 4y ago
  Not the person you are responding to, but is there somewhere reputable offering these kinds of contracts to no-name retail investors like myself? I would absolutely load up on something like 12,000 - 15,000 USD bitcoin puts depending on the time decay people are offering and how certain I could be that they would actually let me exercise them, and not freeze trading or even go belly up during the crash. I am somewhat.. skeptical I will be able to exercise them on an primarily crypto exchange like Binance that has blocked trading during freefalls before that is structurally dependent on the price of crypto to some extent.
  - MacsHeadroom 4y ago
    There are dozens of dApps where anyone with an internet connection and money can buy/sell puts and other options on BTC anonymously. They have full openly auditable reserves and all their code is open source and visible on their respective smartchains. Wanting an institution to provide a sub-par solution for this is a cop-out. Put up or shut-up.
    - mattnewton 4y ago
      With a centralized service I don’t need a law degree, I can quickly ask an expert what my rights are and understand an option, and there is a (limited and slow, but existant) method to make myself whole in the event of a problem. Each dApp is its own special setup and it can be quite complicated to figure out exactly how it behaves, who to sue if it doesn’t, and who to pay money to find these things out for me. I hope you’ll forgive me for being worried about trusting that with any significant sum of money.
      - aaaaaaaaata 4y ago
        Stop outsourcing protecting yourself.
        mattnewton 4y ago
        No man is an island. I’d rather pay taxes for police and hire a plumber than live in the woods with a rifle and fetch my own water, given that there are only so many hours in a day to try and be an expert on everything.
- FabHK 4y ago
  You're selling puts on BTC struck at 1000 at a discount? Yes, I'll take a few.
  - benreesman 4y ago
    I said 75 bps off what Black Scholes kicks out, gets a little weird with the thin market, and the expiration has to make sense, but in general, fuck yes? You think BTC is going to drop like 20x in a sane options duration? I think a lot of people would sell you that.

by dmoy 4y ago

uoaei 4y ago

It's like any other investment option, in that it's basically a legalized bet with contract language enforcing it.

hinkley 4y ago

That’s just the sort of definition of Floor that leads to internet breaking production outages.

benreesman 4y ago
Thank you.

benreesman 4y ago

Anyone can invent quasi-financial terms to make grandiose claims. The beauty of the market is that loudmouths don’t participate in the market for long. I’ll sell an American-style options contract to someone who thinks BTC is going anywhere near there at Black-Scholes -75. And I’ll have no trouble financing it. You want the other side?

joebob42 4y ago
I don't think "is this where the price is going" really has anything to do with what gp was even saying.
pcthrowaway 4y ago
I'm pretty bullish crypto but I think there's a chance Bitcoin hits $1000 again in the next 10 years or so.. mainly because I think the case for Ethereum is much better. I don't understand what Black-Scholes means, but if you're willing to take 10 to 1 odds in my favour I'll draw up a smart contract: we both deposit USDC and receive tokens for our position which can be resold if desired; if bitcoin hits $1000 or less according to the Chainlink BTC_USD oracle at any point between now and 10 years from now, I get 10 USDC for every one of mine wagered
px43 4y ago
Shh.. you're scaring all the people who think their computer science degree gives them exceptional insight into how money works.
- benreesman 4y ago
  In fairness, I was one of those people until I landed at a satellite office of my SV company in New York and started hanging out with real finance players.
mattnewton 4y ago
Not the person you are responding to, but is there somewhere reputable offering these kinds of contracts to no-name retail investors like myself? I would absolutely load up on something like 12,000 - 15,000 USD bitcoin puts depending on the time decay people are offering and how certain I could be that they would actually let me exercise them, and not freeze trading or even go belly up during the crash. I am somewhat.. skeptical I will be able to exercise them on an primarily crypto exchange like Binance that has blocked trading during freefalls before that is structurally dependent on the price of crypto to some extent.
- MacsHeadroom 4y ago
  There are dozens of dApps where anyone with an internet connection and money can buy/sell puts and other options on BTC anonymously. They have full openly auditable reserves and all their code is open source and visible on their respective smartchains. Wanting an institution to provide a sub-par solution for this is a cop-out. Put up or shut-up.
  - mattnewton 4y ago
    With a centralized service I don’t need a law degree, I can quickly ask an expert what my rights are and understand an option, and there is a (limited and slow, but existant) method to make myself whole in the event of a problem. Each dApp is its own special setup and it can be quite complicated to figure out exactly how it behaves, who to sue if it doesn’t, and who to pay money to find these things out for me. I hope you’ll forgive me for being worried about trusting that with any significant sum of money.
    - aaaaaaaaata 4y ago
      Stop outsourcing protecting yourself.
      - mattnewton 4y ago
        No man is an island. I’d rather pay taxes for police and hire a plumber than live in the woods with a rifle and fetch my own water, given that there are only so many hours in a day to try and be an expert on everything.
FabHK 4y ago
You're selling puts on BTC struck at 1000 at a discount? Yes, I'll take a few.
- benreesman 4y ago
  I said 75 bps off what Black Scholes kicks out, gets a little weird with the thin market, and the expiration has to make sense, but in general, fuck yes? You think BTC is going to drop like 20x in a sane options duration? I think a lot of people would sell you that.