Thanks, yes I was looking at your system a few days ago, you did a good work creating one!
I'm substantially more interested in futures contracts, because they are "simpler" for understanding and for trading than options.
Denomination in BTC, I think it should not be a big problem, and it's discussable according to how people want it.
Let's take an example from Russia, because Russian's currency is not USD: There is a futures contract on RTS index (the index is called RTSI, the futures is called RTx where x is the expiration date code).
RTSI is nominated in US dollars (1878.55 was the last closing value). RTx also nominates in points (e.g. last trade of 9.11 futures was executed at 184830, which corresponds to expectation of this index at 1848.30 at 9/2011).
Now the fun part is that margin variance and contract settlement and all related calculations are performed in Russian Rubles. So that if I want to buy 1 RTx contract at 184830, this will be US $3685 total value, and initial margin US$ 296. Paid in Rubles, the exchange ratio is being adjust two times per day at predefined time interval.
Millions of people trade it this way in Russia and have no problems
. It even makes it more interesting for arbitrage traders because the USD/RUB ratio comes into consideration.