Can you explain a bit better please?
They are cash-or-nothing binary options. Their strike price is 386. They will expire on Nov 30. The payoff of each binary option is 0.01 BTC, so if the underlying price at the expiration is higher than 386, you will get 0.01 BTC payoff for each option. |
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How can they prove that? I know they can somehow prove that they have money at some point. But that's still not very convincing.
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A simple name will not do it. You need to establish a reputation by legitimate business practices. There are many who expose their name, some real some not, and still run away with money.
Could you elaborate on the "legitimate business practices"? I really want to know that. To me most exchanges such as bitfinex and bitstamp still have no convincing proof that they won't run away with the money, but they have many users trusting them. What's the reason? Is it because they have good looking web interface? Or is it because they have been existing for quite a long time? Or their business model makes them profitable so that they don't have to run away? |
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By trading options, you can also handle the volatility more deliberately.
You need a counter party for the trade. Only a fool would trade derivative based on bitcoin or short volatility. Yeah, vanilla options are difficult to find a counter party as the seller bears very high risk. But binary options offer you an easy way to trade volatility. By binary options, I mean exchange traded options with multiple strike prices not the one for betting. How would a seller price binary option then? The premium would need to be high even for short term binary option, and who is going to buy it? Pricing of binary options can be done using the Black-Scholes model http://en.wikipedia.org/wiki/Binary_option#Cash-or-nothing_call. Premium depends on many factors including the strike price and volatility. For example, if the current BTC price is 380, I guess the call option with strike price 1000 should be very cheap. |
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By trading options, you can also handle the volatility more deliberately.
You need a counter party for the trade. Only a fool would trade derivative based on bitcoin or short volatility. Yeah, vanilla options are difficult to find a counter party as the seller bears very high risk. But binary options offer you an easy way to trade volatility. By binary options, I mean exchange traded options with multiple strike prices not the one for betting. |
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Is the market so inefficient? What's the horizon of your forecast?
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By trading options, you can also handle the volatility more deliberately.
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Derivatives can help stabilise the market.
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Somebody is trying to buy BTC/USD call options that expire on 2014-11-30. The strike price is 386. If you are willing to sell, please visit https://coinut.com |
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Somebody is trying to buy BTC/USD call options that expire on 2014-11-30. The strike price is 386. If you are willing to sell, please visit https://coinut.com |
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Regarding the counter-party risk, we currently support binary options only. For binary options, it is impossible for the sellers to default, because the maximum possible loss of sellers is fixed at the very beginning, and the system can automatically check the users' balance and reserve enough margin that can cover the maximum possible loss before the user actually buys an option. We are still working on vanilla options. As vanilla options are much more risky, it is going to take a little more time for us do work out a good solution.
As many of you suggested that it is difficult to trade when the maturity periods are too short, I have changed the periods from within 1 week to a few weeks. This can probably make you trade more deliberately.
To make you trade more conveniently, I am planning to add a binary options pricing calculator to the interface.
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This is expected. Volatility is a derivative of price and derivatives by definition have larger swings then the underlying security they are attempting to mimic. Volatility is computed directly based on the log of price ticks instead of price ticks. Volatility is quite volatile, but it's more regular than price. |
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A bitcoin options exchange needs to be very well trusted, which you are not. It would also need to be very well funded to protect itself against defaults by traders so it can keep traders "whole" when they have a profitable trade.
It would be a much better idea to start a reputable exchange and then expand into options trading instead of getting directly into options trading.
Our risk is the same as a normal exchange because we currently support binary options only. Users' maximum loss can be determined beforehand and thus can be fully covered by margin. Therefore there is no need to worry about defaults by traders. |
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I think you must make better site and then all go smoothly  You can try to get some advice on this - may be even free of charge Thanks. Do you have any specific suggestions? |
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this doesn't make sense as far as traditional options go so maybe it works differently?
May I know which part does not make sense to you? |
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First bitcoin options site good luck with your site. Nobody buying put options.
I saw you registered. Are you interested in selling put options? |
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This is not about BTC design, but about the very nature of money and capitalism. Even if the initial distribution was made in such a way that everyone started with the same amount, it would eventually return back to a few people.
Right, the capital distribution in the world is only slightly different because of government control, so that the poor are not too poor. But since there is no control for the bitcoin world, the poor will be extremely poor, and the rich will be extremely rich. I am sure implementation of tax laws with respect to bitcoin will get stringent very soon. [/quote] That's possible. But the government needs a better way to track the transactions. |
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any 'company' using bootstrap is a complete joke. esp default styling. clearly built by people without taste. i sense greed is the only motive. i'd not spent a single satoshi there.
Oh, thanks for the comments. I am a computer scientist instead of a designer. But don't worry about that, my designer is working on it. I just want to follow the standard procedure of iterative design and minimize the cost. |
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Another noob idiot.
Could you elaborate? |
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