Options represent one of the most popular financial derivatives used in the conventional finance industry today & definitely one of the most profitable. If you know how to make use of them they can easily become gold mines providing users with a constant income flow.
But first thing’s first:
What is Chainge Finance?
Chainge is a DeFi app running on the Fusion blockchain that empowers people from all corners of the world to become their own digital bank. With Chainge’s automated financial services, users have complete control over their wealth while enjoying 100% freedom & security.
From cross-chain swapping to earning through time-framing and liquidity mining Chainge unfolds a completely new decentralized financial universe. With no hassle & no limits.
The innovation Chainge Finance brings to the table
Just a few months since launch and this unique DeFi app has already gained over 400,000 users and $60 Million Total Value Locked in Liquidity pools.
On top of their already popular money-making features, Chainge Finance has set out to complete their Decentralized Exchange Trilogy with one final ground-breaking addition: The Options DEX.
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But what makes the Chainge Finance Options DEX so special?
First and foremost, the fact that it’s the first one of its kind. Until now, options have been a centralized tool reserved for specialized traders and institutions that used them to acquire the right to buy or sell an asset at a predetermined price within a set time-frame. This rigid context allowed Wall-Street giants to profit from certain market movements while the regular user did not have the same privilege.
So, in an effort to offer a fair financial market to retailers and projects alike, Chainge built an option market in a 100% decentralized way; an option market that anyone anywhere can access and utilize in order to maximize their wealth’s potential.
How will the Chainge Options market work?
Chainge will be providing an online form to apply the listing of options of a certain token with a requested exercising price. Once it gets approved by the Chainge community by voting with CHNG (number of votes has to exceed 1 million CHNG votes), it will automatically be listed in the Chainge Options DEX. After it’s listed, everyone is free to write and exercise said options in a decentralized way.
What can you do with an option?
There’re quite a few things you can do with your options:
- You could exercise your call option by injecting back the option token and the corresponding predetermined exercise price in USDT to receive the underlying assets. And you also could exercise your put option by injecting back the option token and the corresponding underlying assets to receive the USDT in predetermined exercise.
- You could keep this token in the Chainge app or send it to others in the same way you do with any other tokens.
- You could sell the option token in the Option DEX market when you feel the price of XYZ-CO is good enough.
- Or you can add liquidity to the Option DEX market in the XYZ-CO/USDT pair and gain trading fees plus CHNG rewards as liquidity farming.
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What benefits do options bring to retail traders?
1. The volatility of an option (both call options and put options) is higher than its underlying token, but they are highly correlated. So, it would be much more profitable to trade options than to trade the underlying tokens if the price moves in a direction that’s in your favor.
2. Although trading options is more profitable than trading underlying assets when the price moves in a favorable direction, it is a lot like margin trading in CEXs. However, in margin trading, if the price moves in a direction that’s not in your favor, and you do not meet the margin call, the CEX can close out any of your open positions in order to bring the account back up to the minimum value. This is known as a forced sale or liquidation. That’s the end of your position. Even if the price moves back to in your favor later, you won’t get anything from it, because your positions were forcibly closed.
Trading options is a different story: even if the price moves in an unfavorable direction, as long as it bounces back before the end of the exercising deadline (the end of this year), your previous loss will be covered.
3. Retail traders could buy put option as a kind of insurance or protection of their investment.
4. Retail traders could also write call options or put options to sell on the market if they feel the option premium is insanely high.
Any of these actions can bring you substantial gains and are amazing ways to get some extra income without having to worry about the complexity of it all. You’ll be met by a smooth UX, while all necessary processes will run in the background.
Why should a project or company list an option in the Chainge DEX?
- Project teams or companies can write call options to motivate employees and communities to shill their projects.
- Project teams or companies can write call options and sell their token at a higher price.
- Project teams can write put options to show their confidence in the project to the token holders.
- Project teams can write put options to buy back tokens at a lower price.
- Last but not least, Chainges’ 410 k users will become their users.
To conclude, the Option DEX, set out to launch this week, will open up a whole new world of profitable opportunities that people and companies never thought would be within their grasp. And while the market is going to be fairly new, it will most surely spread like fire while changing the way we perceive financial freedom.
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