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Author Topic: Bitoption.org -- ESCROWED LIVE Bitcoin Options Trading  (Read 35056 times)
DamienBlack
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June 15, 2011, 03:10:56 AM
 #181

Quick bug:

If you put in a decimal in the # of contracts section (which I did on accident), the error message tell you that you are logged out, instead of informing you about the decimal.

"There was a server error, your bid / ask didn't go through. Sorry!

Probably you got logged out of your session.

Try logging in again first."

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brendio
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June 15, 2011, 03:37:10 AM
 #182

Woot, I just manage to sell my first option at a higher price than I picked it up for. Liquidity here we come.

By the way, they did not 'cancel out' in my 'active contracts'. This is what I see:

BOUGHT    2011-07-28    call    50.0000    1    -30.7    Exercise
WROTE    2011-06-23    call    28.5000    2    -9.2    
WROTE    2011-07-28    call    50.0000    1    -30.7  

Since the first and third are the same contract, one bought, and one wrote, shouldn't they just go away? Or do american options not work like that since I may choose to exercise it at a different time? I was trying to sell the option I had, not create a new contract, I figured it was the same thing. Now I have an extra bitcoin tied up. Sad What did I do wrong?

Which leads me to another question. Are the options auto-exercised at strike if they are in the money? I guess not... hmmm...

I think this is still on the to do list.

DamienBlack
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June 15, 2011, 04:22:23 AM
 #183

Woot, I just manage to sell my first option at a higher price than I picked it up for. Liquidity here we come.

By the way, they did not 'cancel out' in my 'active contracts'. This is what I see:

BOUGHT    2011-07-28    call    50.0000    1    -30.7    Exercise
WROTE    2011-06-23    call    28.5000    2    -9.2    
WROTE    2011-07-28    call    50.0000    1    -30.7  

Since the first and third are the same contract, one bought, and one wrote, shouldn't they just go away? Or do american options not work like that since I may choose to exercise it at a different time? I was trying to sell the option I had, not create a new contract, I figured it was the same thing. Now I have an extra bitcoin tied up. Sad What did I do wrong?

Which leads me to another question. Are the options auto-exercised at strike if they are in the money? I guess not... hmmm...

I think this is still on the to do list.

Which part, auto-exercising or selling the contract I already have? If I can't sell the contracts I have it make dealing in long time frame options really unpleasant. That means to exit a position I have to escrow all the resources to bid and ask, when really my resources should be completely free. This can't be right... It also increases the commission I  have to pay if this contract does end in the money... I would have to pay twice, once when the buyer exercised and once when I do... That's a whole extra dollar, and a bitcoin locked in escrow for a month, bad deal. Sad

I trade bitcoin options at https://bitoption.org/ ... Join me.
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brendio
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June 15, 2011, 04:28:57 AM
 #184

Sorry about the confusion. Selling the contract is what I meant, but I'm pretty sure auto-exercising is also on the drawing board.

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June 15, 2011, 04:31:12 AM
 #185

Feature request: Is it possible to record the option premium paid/received in the contract list? This would be helpful is seeing at a glance whether you're winning or losing on a contract.

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June 15, 2011, 08:21:39 AM
 #186

Another feature request: Display system time somewhere on the page, or time remaining until next option expiry. This would be useful as we approach the first lot of options expiring. This would save having to try to work out how long an option has left to run.

Cheers.

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June 15, 2011, 08:45:14 AM
 #187

Another feature request: Display system time somewhere on the page, or time remaining until next option expiry. This would be useful as we approach the first lot of options expiring. This would save having to try to work out how long an option has left to run.

Cheers.

Seconded. I would love a countdown so I know for sure I don't have my times wrong.

EDIT -- Nice job that was fast. It was good you got in on there, I'm an hour off for some reason. Perhaps daylight savings.

I trade bitcoin options at https://bitoption.org/ ... Join me.
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bitoption
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June 15, 2011, 07:37:44 PM
 #188

Lots of updates here:

Buy to cover / sell to cover: coming.
I added color coding for ITM options, helps the board a bit, I'd say.

"Netting" your options for available funds makes sense, BUT we would also need to restrict exercising them in certain cases; I want to make sure the logic is correct.

Server time: Python and UTC is a surprising pain in the ass. We're currently reporting the correct time as far as we know it; synced up not infrequently by the server, and accurate to within a second or two from your browser through to our app server and database server.

I'm hearing the margin requests, and I agree it would bulk up the market. I'm going to sit down with a pad of paper and diagram out some logic today to see how this can be done.

Price history is going in shortly; that will be nice, I agree.

I've started putting out ads for python programmers to help; there's more than a fulltime job of stuff to do. In the interim, I'm just trying to knock off the biggest needs first, and keep working down the list.


Reminder We do not auto-exercise in-the-money options at expiration; you must do that yourself. Click on "My Contracts" and use the "Exercise" link. If you do not have the cash to exercise them all at once, you will exercise as many as you have funds for. You MUST then exchange and continue the exercising process; since Mt. Gox is not always highly liquid, this might impact the intrinsic value of your options.




----** In Beta: The First Bitcoin Options Market ----**

Explanation and discussion: http://forum.bitcoin.org/index.php?topic=9611.0

API Developer Thread:
http://forum.bitcoin.org/index.php?topic=14194.0

-----------------------------------------------------------
brendio
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June 15, 2011, 09:46:22 PM
 #189

Just wanted to say that the interface is coming along nicely and your response time is excellent. I could probably come up with a whole list of other feature requests, but the website is not a lot more usable than even a few days ago. I was starting to try to figure out how to use API. I would still like to, if there was a good tutorial somewhere. But the need to do so is not so pressing now. Cheers.

brendio
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June 16, 2011, 12:09:52 AM
 #190

I'll contribute 1 btc bounty for a very basic functioning bot that you approve. Please include a basic BS model.

I like your API, I place all orders with it using an excel spreadsheet. I don't place orders through the browser.

Hi TTBit,

I'm still trying to learn all about how API works and am very interested in your Excel interface. Would you mind elaborating at all on how you set it up (or even PM me a copy?). I think it would be great to be able to graph payoff diagrams in Excel and be able to place orders from there as well.

brendio
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June 16, 2011, 12:22:36 AM
 #191

Okay, so expired options are evidently not released automatically upon expiry. Is this on the to do list (along with the auto-execution)? I'm ready to start writing the next round of options, but need my Bitcoin released from escrow on the expired option.

With the auto-execution of in the money options not yet enabled, I had the really sneaky idea of writing calls on in the money bids a few seconds before their expiry in the hope/assumption that the bidder would not have time to exercise them before expiry. In the end, I didn't have the required Bitcoin in my account to do so. It does highlight a danger though for the unwary if you have orders left on the market right up until expiry. Perhaps you could think about implementing a trading halt a certain time before expiry to allow people time to exercise if their order is filled at the last minute.

bitoption
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June 16, 2011, 12:34:28 AM
 #192

Update

We finished out our first close date with only minor drama; I set up to manually expire the first date, then missed my own deadline, so Options Exercisers got an extra 25 minutes to exercise. I'll check the logs and see if anybody did this; then reimburse for any value delta.

Our Mt. Gox trading connection is still flaky; this has turned out to be one of the hardest parts of the system. I'm now running four virtual servers and they need to periodically claim a new token from Gox; I don't think anyone was harmed by this bug this time around, but by next week, we'll have a more resilient system in place. Mt. Gox seems to have shortened the time they'll accept your token, and combined with the DDOS protection there, we had a little bit of excitement today. Magical Tux was up past midnight in Japan helping make sure we stayed live, which he absolutely did not have to do. (THANKS!)

Your BTC / USD are all released now, so go forth and bet again on next week, I know I will be. : ).

I have a draft of a working margin / buy and sell-to-cover savvy / auto-execution system. I'm going to post it for comments; as it stands, it will not be too terribly difficult to implement. I do not know how to insure against all market depth risks, so I would like to discuss this a little bit with everyone before we move ahead. That said, I'm sold on the idea of being able to offer up to your total available BTC/USD on any contract type as a way to fill the market out. We'll want more than one person to do that, of course. : ).

Brendio, I'm pretty sure sneakiness is fundamental to the option-trader lifestyle... That said, we all appreciate your forbearance, I'm sure. : ) I do believe a trading halt would make sense; 24 hours? 12 hours? I'm open to suggestions.

Thanks all for the really fun and exciting first week. More coming, no doubt.




----** In Beta: The First Bitcoin Options Market ----**

Explanation and discussion: http://forum.bitcoin.org/index.php?topic=9611.0

API Developer Thread:
http://forum.bitcoin.org/index.php?topic=14194.0

-----------------------------------------------------------
DamienBlack
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June 16, 2011, 03:25:04 AM
 #193

Everything sounds really good. Can't wait to hear more.

I was also thinking about writing some calls right before the options expired. But in the end I decided that would be pretty low and potentially hurt the credibility of the system. I think until auto-exercise is up and running, the bids and asks should be pulled and hour or two before strike. I wouldn't do it if I knew I had the other person would have a full hour to exercise it.

PS I'm pretty handy with python and would be willing to help some.

I trade bitcoin options at https://bitoption.org/ ... Join me.
I play poker at https://betco.in/ ... Join me.
Support the bitcoin economy, what do you do?
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bitoption
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June 16, 2011, 03:43:03 AM
 #194

Damien, I would love to have you work on a sort of canonical trading bot; are you open to doing that? I will happily support you as you get your head around it. The APIs are published online (and in the bitoption API thread here), and I have a few unpublished - but available - ones that will help.

What would be great would be something on github that people could fork and add their own intelligence to.

E-mail me if you need help getting started.

I'm totally excited about that offer, thanks!

----** In Beta: The First Bitcoin Options Market ----**

Explanation and discussion: http://forum.bitcoin.org/index.php?topic=9611.0

API Developer Thread:
http://forum.bitcoin.org/index.php?topic=14194.0

-----------------------------------------------------------
DamienBlack
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June 16, 2011, 03:57:00 AM
 #195

Sounds good. I was thinking about doing something like that with the API anyway. I'll start tinkering. I'll let you know if I need anything.

I trade bitcoin options at https://bitoption.org/ ... Join me.
I play poker at https://betco.in/ ... Join me.
Support the bitcoin economy, what do you do?
Tips: 1NfXhiTFEdKQTdLy49s6DYAP1K7MeFWyao
nrd525
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June 16, 2011, 05:57:52 AM
 #196

This website series looks like a good tutorial on options:
http://www.investopedia.com/university/options/default.asp

Don't day trade.
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June 16, 2011, 06:29:20 AM
 #197

@nrd52, I think what you should do is bid on cheap puts. You can send me USD via mt. gox' send USD interface (to admin@bitoption.com) and you'll never have to touch BTC until you decide you want to exercise your puts.

How can I do this?  I don't see a send USD option (on the website).  I see the withdraw funds, but no place for an email address.

Don't day trade.
bitoption
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June 16, 2011, 07:03:59 AM
 #198

If you click your name, you will see some options, including (I believe) one called Payment API. Just turn them all on; as far as I know, there are no security risks in doing so.

Once you do that, you'll be able to send money to an email address.

I just cleared one this week for someone; please put your account name in the notes section. Smiley.


----** In Beta: The First Bitcoin Options Market ----**

Explanation and discussion: http://forum.bitcoin.org/index.php?topic=9611.0

API Developer Thread:
http://forum.bitcoin.org/index.php?topic=14194.0

-----------------------------------------------------------
FreeMoney
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June 16, 2011, 07:33:59 AM
 #199

I'm such a noob. I left the bids out through expiry. It looks like I only lost on the OOTM ones (thanks Damien and others). I was thinking for some reason I had until Thursday night, so I checked in Wednesday evening, but of course midnight Thursday had already happened (in Europe is it?)

Glad to have made the mistake on a small scale though, cheap lessons.

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bitoption
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June 16, 2011, 07:52:52 AM
 #200

Damien brought up expire times on bids; makes sense for this situation, along with a trading halt.

I added in a server time countdown today for just such a reason; and the server is on UTC / GMT. So we're locked in currently at London -1 (It's British Daylight Time right now).

----** In Beta: The First Bitcoin Options Market ----**

Explanation and discussion: http://forum.bitcoin.org/index.php?topic=9611.0

API Developer Thread:
http://forum.bitcoin.org/index.php?topic=14194.0

-----------------------------------------------------------
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