A new story from What Bitcoin Did


Think there's some let's assume there's some like mean reversion so if you're short and bitcoin rips up you get closed out even if it's going to dip back down in the other way too but if you have collateral to manage those positions than your these buying yourself the safety that you can withstand those fluctuations and you can still close out of the position when bitcoin goes down but you do it on your terms and not the exchanges terms and i think managing that is a lot of what professional traders do very well I think actually if you look at a lot of the professional trading shops and you talk to a lot of traders they are very insightful about markets they understand the signals but they also really have a good handle on collateral management because in the bitcoin space in the Space everything is it's real time gross settled. So it's all pre funded so if you get a move. You can have a margin call to liquidation. Be like way too close together for you to even try to move on one or two confirms on chain So it's really. It can be difficult to get that collateral where you to but if you have enough collateral ben than yet you can you can sustain those. That's moose might reto use the consider that someone like myself imagine. I don't know. I know at the end of the year. I've got a pretty successful job. Say i think. I'm going to get one hundred thousand dollar bonus of the year but i wanna buy bitcoin now and i know that money's coming with that baby s and i think bitcoin is going to be significantly higher by the end of the year. Is that a time where i may consider a futures knowing. I've got that money coming in the future. Is that as you think people might use it. Could i mean it really starts to depend at that point on how the cash flows work. And that's really specific to every exchange in terms of like. How do they margin it. What did they require you to post today versus at some point in the future but i think actually for case like that that's where something like an option becomes really interesting because in option you're paying a smaller amount upfront today for the right to buy it at a certain price on a date in the future and so that's a great way to get again a little bit of natural leverage because you don't have to lay out the full thirty thousand for a bitcoin you can buy indicate pay a thousand two thousand dollars for an option And you know you have this limited downside that is against smaller than if you were to buy. Bitcoin is two thousand two thousand dollars. So you can measure your risk reward. Get yourself that exposure. Not miss out. If there's another big run and then on that date in the future let's say the option was struck at thirty thousand. Let's say at the end of the year. Bitcoins fifty thousand. And you get your hundred. Bamboo bonus will then you can just pay the thirty thousand to exercise in. Get that twenty thousand dollar upside. So i think in in those kinds of cases options make sense so we thought does hit on essentially get in bitcoin. A fairly cheap price is the price has gone up. Who who's who's on the losing side because there's somebody there full selling it at a at a price lower than his worth. Yeah a good point so or good questions yes in. You don't into relatives in the scope..

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