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August 29, 2012, 05:40:32 PM
Last edit: August 31, 2012, 12:15:41 PM by TTBit |
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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.
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