Bitcoin Forum
June 18, 2021, 03:58:08 AM *
News: Latest Bitcoin Core release: 0.21.1 [Torrent]
 
   Home   Help Search Login Register More  

Warning: Moderators do not remove likely scams. You must use your own brain: caveat emptor. Watch out for Ponzi schemes. Do not invest more than you can afford to lose.

Pages: [1]
  Print  
Author Topic: Writing PUT options on the gold/btc and silver/btc price  (Read 1247 times)
TTBit
Legendary
*
Offline Offline

Activity: 1136
Merit: 1001


View Profile
August 29, 2012, 05:40:32 PM
Last edit: August 31, 2012, 12:15:41 PM by TTBit
 #1

In this thread, I will attempt to write put contracts on the BTC/Silver price and BTC/Gold price. This gives the buyer (you) the right - but not the obligation -, to deliver silver and/or gold for BTC at a fixed (strike) price during the length of the contract.

Benefits to you (the option buyer, metal seller):
* If the btc price crashes, or the price of silver/gold skyrocket, you simply walk away with no obligation. Your loss is the premium paid in BTC.
* However, if the btc price skyrockets or the price of gold & silver crash, I must purchase from you at a relatively high price.
* You don't have to own the metal at any time to participate, but you must deliver if you want to profit from the contract. You can send the metal to me (or have me purchase it with escrowed BTC) via 3rd party, such as coinabul, only if in your interest to do so.

Details:
Delivery: You are responsible for shipment to my location (USA East coast).
Contract Expiration: December 31, 2012. All packages must be postmarked on or before this date.
Strike Prices are a fixed buy price to purchase from you at your discretion

The variable:
Premium you need to pay up front (Prices good as of Aug 31 2012 ET).
Silver:
2.00 Strike: 0.040 btc per troy ounce
1.00 Strike: 0.015 btc per troy ounce

Gold:
100.0 Strike: 1.00 btc per troy ounce
50.0 Strike: 0.40 btc per troy ounce.


The fine print for delivery:
Silver: I accept .999 and junk (.900) coin silver ($1 US=0.715 oz for 1964 and earlier dimes, quarters & halves). Sterling jewelry / flatware is not acceptable. I'll offer a rebate of $2.5/oz for US silver eagles, $1.50/oz for other .999 silver, and $1/oz for Peace/Morgan dollars (1 US silver dollar = 0.760 oz). No rebate for coin silver (junk). Coin silver must be free from holes and major dents. I'll reluctantly take 40% silver ($1 US=0.295 oz), but no war nickels.

Gold: Coins and bullion only. At least .900 purity. Again, no jewelry. Rebate of $60/oz for US gold eagles, $50/oz for Krugerrands, $30/oz for other .999 bullion and ~22 karat coins (foreign currency & US pre-1933 gold coins applicable).

Rebates: Delivering a superior product entitles the buyer to a rebate. The closing price of BTC/USD will be taken for Dec 31, 2012 (or earlier if delivered) and refunded in BTC form. Example: Year end price is $40/BTC and you delivered 10 oz of US silver eagles, expect 0.50 btc ($20) in rebate. I may offer a slightly higher rebate for fractional gold or higher quality products, but this will be at my discretion. You can over/under deliver (say +/- 10%) for rounding purposes when delivering foreign gold & US Silver junk, but there must be a good faith delivery. I'll pay/credit spot based on year end close of silver/usd, gold/usd and BTC/usd.

With every trade:
* I'll publicly fund a separate address for every potential delivery with full value.
* I won't buy back these options, I intend to take delivery. If it is in your financial interest to deliver please acquire the metal or sell your contract to someone else. Remember, you can just direct me to purchase from a 3rd party with escrowed BTC to satisfy the contract (rebates still apply).
* I'm happy to do escrow at your expense, but I have to agree to the agent.

Example trade:
You purchase 10 put options with a 2.00 strike from me at 0.07 btc per ounce. Your total is 0.70 BTC. I fund a separate address with 20.00 BTC. At any time before the end of the year, you can deliver 10 ounces of silver to me and I will send the 20.00 BTC to you.

good judgment comes from experience, and experience comes from bad judgment
1623988688
Hero Member
*
Offline Offline

Posts: 1623988688

View Profile Personal Message (Offline)

Ignore
1623988688
Reply with quote  #2

1623988688
Report to moderator
1623988688
Hero Member
*
Offline Offline

Posts: 1623988688

View Profile Personal Message (Offline)

Ignore
1623988688
Reply with quote  #2

1623988688
Report to moderator
1623988688
Hero Member
*
Offline Offline

Posts: 1623988688

View Profile Personal Message (Offline)

Ignore
1623988688
Reply with quote  #2

1623988688
Report to moderator
Advertised sites are not endorsed by the Bitcoin Forum. They may be unsafe, untrustworthy, or illegal in your jurisdiction. Advertise here.
HeavyMetal
Newbie
*
Offline Offline

Activity: 42
Merit: 0



View Profile
August 29, 2012, 06:47:12 PM
 #2

A very interesting idea. I like that this can be done with real gold instead of just paper gold.
Stephen Gornick
Legendary
*
Offline Offline

Activity: 2506
Merit: 1001


View Profile
August 29, 2012, 07:23:04 PM
 #3

I fund a separate address with 20.00 BTC. At any time before the end of the year, you can deliver 10 ounces of silver to me and I will send the 20.00 BTC to you.

Would you consider securing the bitcoins with an escrow?

Unichange.me

            █
            █
            █
            █
            █
            █
            █
            █
            █
            █
            █
            █
            █
            █
            █
            █


TTBit
Legendary
*
Offline Offline

Activity: 1136
Merit: 1001


View Profile
August 29, 2012, 07:40:00 PM
 #4

I fund a separate address with 20.00 BTC. At any time before the end of the year, you can deliver 10 ounces of silver to me and I will send the 20.00 BTC to you.

Would you consider securing the bitcoins with an escrow?

Absolutely. For you, I'd consider sending coins up front. Just return either the coins or silver in January.

good judgment comes from experience, and experience comes from bad judgment
fourd00rgtz
Full Member
***
Offline Offline

Activity: 151
Merit: 100


View Profile
August 30, 2012, 02:27:17 AM
 #5

Would you consider a rebate offer for silver maples equal to that of eagles, or do they fall in the category of other .999?
Stephen Gornick
Legendary
*
Offline Offline

Activity: 2506
Merit: 1001


View Profile
August 30, 2012, 02:49:40 AM
 #6

Absolutely. For you, I'd consider sending coins up front.

Heh, I appreciate that.  Though you'ld been involved in bitcoin projects before I even knew what it was.  :-)

Unichange.me

            █
            █
            █
            █
            █
            █
            █
            █
            █
            █
            █
            █
            █
            █
            █
            █


TTBit
Legendary
*
Offline Offline

Activity: 1136
Merit: 1001


View Profile
August 30, 2012, 11:20:23 AM
 #7

Would you consider a rebate offer for silver maples equal to that of eagles, or do they fall in the category of other .999?

I'll put them in the same category. Philharmonics too.


good judgment comes from experience, and experience comes from bad judgment
TTBit
Legendary
*
Offline Offline

Activity: 1136
Merit: 1001


View Profile
August 30, 2012, 11:25:46 AM
 #8

Lowered the gold option prices a bit.

good judgment comes from experience, and experience comes from bad judgment
Pages: [1]
  Print  
 
Jump to:  

Powered by MySQL Powered by PHP Powered by SMF 1.1.19 | SMF © 2006-2009, Simple Machines Valid XHTML 1.0! Valid CSS!