Decentralized Options Market: Challenges and Opportunities Coexist, New Blue Ocean of DeFi Awaiting Exploration

robot
Abstract generation in progress

Exploring the Development and Prospects of the Decentralization Options Market

Decentralization Options is a type of smart contract with options attributes issued on the blockchain. Compared to traditional options, it has advantages such as permissionless access, transparency, and no default risk, allowing for better integration with other decentralized products.

Since the DeFi boom in 2020, the decentralized options market has experienced rapid development. Currently, it has formed a pattern of classic options centered around BTC and ETH, as well as various ERC20 token options and exotic options. However, compared to traditional markets, the on-chain options scale is still very small.

All set, just lacking the eastern wind: Exploring Decentralization Options

The main challenges facing decentralized options include:

  1. High cost: including operating expenses, risk costs, and education costs.

  2. The market is immature: there is a lack of stable demand and insufficient liquidity.

  3. Low capital efficiency: requires over-collateralization.

  4. Inadequate infrastructure: Wallets, exchanges, etc. still need improvement.

All set, only lacking the east wind: Exploring Decentralization Options

The main projects in the market include:

  • Lyra: Adopts a liquidity pool model, splitting options risk into Delta and Vega risks for separate management.

  • Deri: Similar to Lyra, adopts DPMM pricing model.

  • Optix: Allows multiple independent funds to compete for quotes.

  • Premia: Balances automated market making and professional market making.

  • Aevo: A hybrid exchange on the Layer 2 network.

  • Y2K Finance: Binary options for stablecoin depegging.

  • Opyn: Innovative perpetual Options product.

Everything is ready, only lacking the east wind: Exploring Decentralization Options

In addition, some structured products based on Options have emerged, such as Ribbon Finance and Cega.

The future development directions may include:

  1. Further improve capital efficiency and pricing accuracy.

  2. Develop more products that integrate with the on-chain ecosystem.

  3. Explore the application of Options in risk management, financing, and other areas.

  4. Combine with emerging fields such as RWA and Layer 2.

Overall, the decentralized options market is still in its early stages, but with the improvement of infrastructure and the advancement of innovation, it is expected to become an indispensable part of the DeFi ecosystem in the future.

All set, only lacking the east wind: Exploring Decentralization Options

DEFI-2.33%
View Original
This page may contain third-party content, which is provided for information purposes only (not representations/warranties) and should not be considered as an endorsement of its views by Gate, nor as financial or professional advice. See Disclaimer for details.
  • Reward
  • 3
  • Share
Comment
0/400
OnchainHolmesvip
· 08-02 12:29
It's lively again, not bad.
View OriginalReply0
OptionWhisperervip
· 08-02 03:22
It's not a blockchain game, don't make it so complicated.
View OriginalReply0
UnluckyMinervip
· 08-02 03:14
Experienced Options, ended up Rekt.
View OriginalReply0
Trade Crypto Anywhere Anytime
qrCode
Scan to download Gate app
Community
English
  • 简体中文
  • English
  • Tiếng Việt
  • 繁體中文
  • Español
  • Русский
  • Français (Afrique)
  • Português (Portugal)
  • Bahasa Indonesia
  • 日本語
  • بالعربية
  • Українська
  • Português (Brasil)