Re:Show HN: Bitcoin derivatives – call and put options
by bjterry on Monday March 24, 2014 @06:35PM
(#7462192)
According to my understanding of your materials, one isn't taking on tail-risk if one is writing puts on your site. In actuality, the price you require to write puts should be lower than if you were writing real puts, not higher.
Regarding your other concerns, we'll address those with more complicated margin requirements for new contracts and multi-sig Bitcoin transactions. For now, you can just set an extremely high price limit for buying puts in exchange for the tail risk you're taking on.
Edit: buying, not selling