Topic: [ANN] Coinut.com - The only Bitcoin Options Exchange [beta] - page 14. (Read 34192 times)

So orders are now back.

WangXinXi we need an explanation.

Well he said 10 btc on twitter.

Sounds like a simple case of inexperience on the market maker's part. Or, that may have been a minor thing, and they left for other reasons. Anyway, I'm trading futures for the time being ... hope Coinut can pull this together.

It's funny. Mr. Wang was over on the Gambling sub-forum here touting how someone made over 20 btc. Does it really count if you gave it back? Lol ...

Yeah I returned the a big chunk of the profits. 20 BTC would've been nice. It was right when they released the volume indicators. The marketmaker would switch from buying put options at 0.00875 to selling put options deep in the money for cheap or something like that. And then it would switch back so that you can sell some back to raise my capital so I could do more each time.

Anyways the marketmaker wasn't too happy about that. And well they were going to leave so I gave some back, since I really wanted the platform to grow. But it looks like they left anyways.

As for black scholes, I think 30 minute pricing makes sense. Even the cheap options, if you keep buying them during a flat market, bitcoin can actually stay flat. And they lose money that one time there's volatility but then the pricing will change.

Also I was wondering about weeklies and biweeklies. They're actually quite expensive for out of the money options. I think you should be able to hedge it especially if you sell binary options on a wide range of strikes.

Btcoracle uses some sort of trading engine to do their odds.

I also think if you're marketmaking you should dynamically price based on demand, to help hedge your position. Also if everyone's buying call options you make them more expensive. That helps reduce exposure.

It seems quite problematic to simply apply black-scholes to bitcoin, given the wild swings in volatility. Bitcoin was built for volatility. You might say it was built to break black-scholes. Market maker has to be either very seasoned, or very deep pockets to make this work. Coinut is NEITHER seasoned NOR deep pockets. They are PHd students getting carried away with their thesis ... lol. I'm hoping this works ... but I'm not overwhelmed by the odds.

Btw, nice score Chris. Apparently you were paying closer attention than me ... Do you mean to say you gave some of your profits back to the market maker?!?

So really it boils down to the price index.

I think to promote transparency coinut should have a page with a chart for the historical index prices.

That'll promote transparency because you'll know the historical settlement prices. You'll be able to check those numbers. And you'll also be able to check if the historical index matches your exercise price.

Secondly Coinut should add a page with all their current price inputs, similar to okcoin.

https://www.okcoin.com/marketList.do

So then you could verify their live data and their live index to see if it matches up.

The price index is based on the bid and ask for bitfinex, bitstamp, and btc-e.

I've talked to them and while they don't disclose the identities of the market makers, I believe that they're separate identities.

Bitmex has marketmakers too and they aren't known. I think they have no obligation to disclose who their market makers are.

I'm quite sure that they have third party market makers.

A few weeks ago the market maker's bot for the daily contract had some serious malfunctions and I was able to ramp up 1 BTC to 22 BTC at expiry. It was quite a grave concern for them. I could have withdrawn, but wangxinxi acted as an intermediary and asked if I could give the marketmaker another chance. 22 BTC was quite a lot for that marketmaker and coinut doesn't have that much volume at the time. So he said the marketmaker was offering a bounty. I made a counter offer and asked for a bit more. And well the market maker agreed.

Well, it seems like he decided to leave now. Coinut has different market makers on the 30 minute and the vanilla options. Actually I believed the weekly, and biweeklies was using a different market maker also. They offer incentives to the market makers for providing liquidity but if the market makers don't feel like it they can stop market making. Now Coinut is going to need to find some new market makers.

Maybe, I should have been betting less and work on bringing in new users first. Now it's going to be hard with a market maker MIA.

Or it could be that the market maker had some sort of trigger that shut down their system. Maybe the markets are just too volatile right now for them to make markets currently.

If Coinut is the market maker, they can very easily manipulate the price index to work against the major money so that Coinut profits on every trading window.  No point in investing until the market maker identity is known.  I have asked many times, and find it dubious at best that Coinut refuses to identify the market maker.  Transparency is key in these new marketplaces, and without the transparency, Coinut very well could be the market maker, as well as the price index setter, which has been pointed out in prior posts as a major concern

This is my concern:

In the interview it was mentioned that Coinut was capitalized out of the founder's pockets in the amount US$100k. If in fact they are the primary market maker, and their 'modified Black-Scholes model' doesn't work well with Bitcoin in the short-medium term, I could see Coinut burning cash quickly ... and then all bets are off.

Just understand that when you deposit and trade here, there are many more risks involved than simply where the bitcoin price is headed. As Chris mentioned there are currently no quotes for the binary options except for the nearest 30-min and 1-hr contracts ...

Did we scare off the market maker?

I wonder if biweekly binary contracts would be able to hedge their position.  With enough liquidity they have a nice curve that they could hedge with.

Price index is too easy to manipulate.  Have been playing with it the past few days to see if I could affect some movements on the Coinut site, and although it is not by much, I usually only need to adjust it a few cents for binaries in order to swing a losing trade into a winning trade at the end of the window.  Will be hard to find serious market makers when the price is so easy to manipulate with much less than 1 BTC.  Really should use last trade price as this is a much more accurate representation of where the market currently sits.

Thank you very much for implementing this. I think this is a very beneficial change. Before vanilla option fees were taking up quite a big part of the cost. Also the fee represented a $1 move which is quite significant for a fee, that's not even the spread. Now the fee is a bit more reasonable, it'll allow people to have an easier time trading.

As you guys requested just lowered down the commission fee for vanilla options to 0.00002 BTC. Enjoy trading.

Open positions have no download function at this moment. If many request, we will definitely add.

you know, I was actually going to put the coinut in my sig anyways but since they have a signature program I might as well do it.

Also do sites usually give you data dumps of open orders?

And I could possibly try doing something. I don't know VBA at all but maybe it won't be too difficult. I really wanted a risk profile for all my positions.

Thanks but I'm not a programmer, and I don't care to learn. If Coinut expects/requires every customer to program their own data dump ... they are dead in the water. I think you know this Chris ... just fulfilling your sig campaign quota ... lol. Keep up the good work.

I learned BASIC on a TRS-80, then never picked it up again. Lol ...

You can currently do this with the API.

You could probably make a nice Excel sheet if you wanted to. I know some people have some sheets set up for Bitmex.

Or you can get a program to do it for you.

Please can we download our open positions? Keeping track of them with pencil and paper has gotten old real fast ...

There's been quite a bit of volume on longer term binary options.

I would think not a lot of it was self trading. They only do self trading when it moves really quickly and probably not very likely.

And someone amassed a decent position on biweeklies.

Oh yeah, my open interest doesn't seem to be displaying for weeklies vanilla options.