@bitoption
Why don't just show both columns one with BTC/USD and the other with USD/BTC ?
Topic: Bitoption.org -- ESCROWED LIVE Bitcoin Options Trading - page 10. (Read 36582 times)
sukrim,
1) Is a small interface bug, there used to be options at those prices
2) Change is tracks the price difference between the last two purchases, so you know if the option is trending up or down.
3) The 0.9 ask at a strike price of .04 call is asking for .9 BTC to deliver 1 USD at a price of .04 BTC/USD, or $25/BTC.
Thus if you pay them .9 BTC today ($27 US), they will deliver you $1 US for .04 BTC later. This is not a good deal. See my above note; switching around the display will help these bad deals become more obvious, I think.
4) Bids / asks are in BTC. They're what you pay for the right to exercise at the strike price.
More on this in a bit, have to run now.
1) Is a small interface bug, there used to be options at those prices
2) Change is tracks the price difference between the last two purchases, so you know if the option is trending up or down.
3) The 0.9 ask at a strike price of .04 call is asking for .9 BTC to deliver 1 USD at a price of .04 BTC/USD, or $25/BTC.
Thus if you pay them .9 BTC today ($27 US), they will deliver you $1 US for .04 BTC later. This is not a good deal. See my above note; switching around the display will help these bad deals become more obvious, I think.
4) Bids / asks are in BTC. They're what you pay for the right to exercise at the strike price.
More on this in a bit, have to run now.
Question for thread participants.
We currently trade BTC-USD. Prices are quoted that way.
Everyone seems to hate this; they want USD-BTC.
That would mean we'd quote like 25.0 rather than .04.
To switch the system over, I would re-author calls as puts, puts as calls, and invert the strike price.
Are people behind this switch?
API users, I don't want to screw you, please let me know if you'd like this. I figure soon is better than late here.
We currently trade BTC-USD. Prices are quoted that way.
Everyone seems to hate this; they want USD-BTC.
That would mean we'd quote like 25.0 rather than .04.
To switch the system over, I would re-author calls as puts, puts as calls, and invert the strike price.
Are people behind this switch?
API users, I don't want to screw you, please let me know if you'd like this. I figure soon is better than late here.
I'm still having a hard time understanding the process and especially what the numbers in each column actually mean:
Currently when looking at "2011-07-28 -- Asks: 1 Bids: 2849"
Sooo... a few numbers, with a lot of "0.something" values.
Some things I don't really get (I'm really NOT intoo options trading, so this might be standard knowledge for someone else):
1) Why are the last 2 rows there? I thought "strike" is a certain value in BTC/USD that is needed to fulfill an option - but there are none on the left and right side!
2) What are the "change" columns for? The values in ther seem a bit arbitrary to me, at least I cannot come up with an explanation when looking at other values in the table for the negative value in "Calls/Change".
3) The "Asks: 1" is probably referencing to the single "Call/Ask" of 0.9. What exactly is now the "bet" of this person/when will it make profit?
4) If I understood it correctly "Call" means buying USD. A call at the strike of 0.04 means, this person wants to spend 0.04 BTC and get 1 USD for these 4 Bitcents between now and July 28th. An ask now means, this person wants to get paid... but in which currency?! Also I don't really get what the 0.05 bid that is against it stands for now - and both are higher than the 0.04 in the "Strike"?!
5) Where do I see how many contracts are behind each value?
6) Why is the table on 2011-07-14 nearly empty and no asks + bids are listed?
It would be really helpful to have at least some currency symbols (like BTC/USD/EUR...) in the table and maybe also some graphical representation (dunno what's standard here) of what people are bidding/asking for.
Also an intelligent mouseover-helper text along the lines of: "Calls/Bid 100 * 0.0010 @ 0.0300 means: 'This person want to buy up to 100 USD at 0.03 BTC a piece (3 BTC total) until [date]. If you agree, the price for this is 0.001 BTC/contract (0.1 BTC for all).'"
I'm not sure if this above interpretation is correct though and also how much/what I'd be charged then though...
Currently when looking at "2011-07-28 -- Asks: 1 Bids: 2849"
| Calls | Strike | Puts | ||||||
| Price | Change | Bid | Ask | BTC-USD | Price | Change | Bid | Ask |
| - | - | 0.0010 | - | 0.0300 | - | - | - | - |
| - | - | - | - | 0.0350 | - | - | 0.0501 | - |
| - | - | 0.0500 | 0.9000 | 0.0400 | - | - | 0.0500 | - |
| 0.0400 | -0.2400 | 0.0100 | - | 0.0500 | 0.0400 | 0.0400 | 0.0400 | - |
| - | - | - | - | 0.0550 | - | - | - | - |
| - | - | - | - | 0.1000 | - | - | - | - |
Sooo... a few numbers, with a lot of "0.something" values.
Some things I don't really get (I'm really NOT intoo options trading, so this might be standard knowledge for someone else):
1) Why are the last 2 rows there? I thought "strike" is a certain value in BTC/USD that is needed to fulfill an option - but there are none on the left and right side!
2) What are the "change" columns for? The values in ther seem a bit arbitrary to me, at least I cannot come up with an explanation when looking at other values in the table for the negative value in "Calls/Change".
3) The "Asks: 1" is probably referencing to the single "Call/Ask" of 0.9. What exactly is now the "bet" of this person/when will it make profit?
4) If I understood it correctly "Call" means buying USD. A call at the strike of 0.04 means, this person wants to spend 0.04 BTC and get 1 USD for these 4 Bitcents between now and July 28th. An ask now means, this person wants to get paid... but in which currency?! Also I don't really get what the 0.05 bid that is against it stands for now - and both are higher than the 0.04 in the "Strike"?!
5) Where do I see how many contracts are behind each value?
6) Why is the table on 2011-07-14 nearly empty and no asks + bids are listed?
It would be really helpful to have at least some currency symbols (like BTC/USD/EUR...) in the table and maybe also some graphical representation (dunno what's standard here) of what people are bidding/asking for.
Also an intelligent mouseover-helper text along the lines of: "Calls/Bid 100 * 0.0010 @ 0.0300 means: 'This person want to buy up to 100 USD at 0.03 BTC a piece (3 BTC total) until [date]. If you agree, the price for this is 0.001 BTC/contract (0.1 BTC for all).'"
I'm not sure if this above interpretation is correct though and also how much/what I'd be charged then though...
Is there a way to see the history of orders that have been filled, and a list of orders that are open?
Update, here's my tasklist:
A) Switch to USD/BTC pricing (finally got my head around it). All options listed and purchased will continue on.
B) Execute and cancel options
C) Binary options (mostly done, actually)
D) Profit?
E) Writing
F) Better UI for order filling
There's more activity today, which is fun. I'm seeing some trades roll across. I've had two interested parties contact about market making as well; keep the thoughts coming.
I will likely be moving date restrictions to monthly until the volume grows; more (plus discussion) before that happens.
A) Switch to USD/BTC pricing (finally got my head around it). All options listed and purchased will continue on.
B) Execute and cancel options
C) Binary options (mostly done, actually)
D) Profit?
E) Writing
F) Better UI for order filling
There's more activity today, which is fun. I'm seeing some trades roll across. I've had two interested parties contact about market making as well; keep the thoughts coming.
I will likely be moving date restrictions to monthly until the volume grows; more (plus discussion) before that happens.
These are good thoughts.
Another solution would be a market maker; then we can see where the action is. This is what I'm interested in, and I'll happily work with anyone who'd like to make some volume commitments and see some fee benefits from us.
There's a good amount of 'getting the word out' that needs to be done; the market will feed on itself in usefulness as more orders get put up.
As far as increasing liquidity, we're currently focused in on trading end of july only anyway, I think the participants are artificially restricting the dates just to get the ball rolling.
I don't think we should limit strike prices further than we have; I think the most important thing is minimizing confusion for non-savvy traders to the point where there's a market.
I am working through a few this-es and thats with what appear to be some larger traders, and I hope and expect that they'll start participating in the next week or two.
That said, there are $2,000 US in offers on the market right now, roughly. And, there is some trading. There are roughly 200 bids at or nearly in the money if you're short;
At any rate, my big job right now is I think better interface and explanation, plus working with people who will provide liquidity. You know who you are; PM me!
Another solution would be a market maker; then we can see where the action is. This is what I'm interested in, and I'll happily work with anyone who'd like to make some volume commitments and see some fee benefits from us.
There's a good amount of 'getting the word out' that needs to be done; the market will feed on itself in usefulness as more orders get put up.
As far as increasing liquidity, we're currently focused in on trading end of july only anyway, I think the participants are artificially restricting the dates just to get the ball rolling.
I don't think we should limit strike prices further than we have; I think the most important thing is minimizing confusion for non-savvy traders to the point where there's a market.
I am working through a few this-es and thats with what appear to be some larger traders, and I hope and expect that they'll start participating in the next week or two.
That said, there are $2,000 US in offers on the market right now, roughly. And, there is some trading. There are roughly 200 bids at or nearly in the money if you're short;
At any rate, my big job right now is I think better interface and explanation, plus working with people who will provide liquidity. You know who you are; PM me!
I think this is an excellent service idea, and it looks like a pretty good implementation. But it looks like it's going to be hard to get the ball rolling. Part of the problem is that you are trying to sell two sides of a transaction to an audience that sits on only one side. There aren't a lot of bears here, that are willing to bet against Bitcoin.
Here are my suggestions. Please accept them in the spirit intended... trying to get your service launched.
1) Simplify your offering. When options are first offered for stocks, typically there are only a few offerings until those get popular. With options, you have 4 different ways to play them: [Buy or Write] x [calls or puts]. In addition, you have the strike price and the date, which multiplies your 4 choices times a lot more choices.
To start with, why not have just a few choices:
Strike price=20 calls that expire end of June. Buy or Write
Strike price=20 calls that expire end of July. Buy or Write
Strike price=30 calls that expire end of July. Buy or Write.
You'd be offering 6 things that people could bid on. No puts (yet). No variable terms (dates and strike prices) that people can enter.
2) Explain, for the first 6 offerings, what needs to happen for someone to make money, with examples. Maybe a Javascript calculator that helps new users to plug in some numbers and see what happens in each case.
3) By default, use the Clearcoin escrow service for the first month or so. Have this as a part of the offering (included in the price of the service). After a month or two, then make it a chargeable extra. At that point, people can trust you as the escrow, or trust Clearcoin for an extra fee. (I'm just trying to think of ways that you can overcome the challenge "why should I trust you?"
4) Market this outside of the Bitcoin forums. "Think Bitcoin is a Pyramid Scheme, destined to fail? Write some calls, and benefit from your wisdom."
5) optionally.... if you think Bitcoin advocates will be the "easier sell" than Bitcoin nay-sayers, then disregard what I said in item 1, and ONLY offer 6 put choices, and no call choices. People who write puts would put up the BTC collateral, and people who buy the puts would only have to put up the premium. Offer the puts in USD, not BTC, as the people who are hard to get in on the transaction won't want to deal in BTC. Example: For $4, you can buy the right to make someone pay you $15 for 1 BTC. If they crash to zero, you'll make $15 (less the $4 you paid).
That's all I have. Hopefully this will take off!
Here are my suggestions. Please accept them in the spirit intended... trying to get your service launched.
1) Simplify your offering. When options are first offered for stocks, typically there are only a few offerings until those get popular. With options, you have 4 different ways to play them: [Buy or Write] x [calls or puts]. In addition, you have the strike price and the date, which multiplies your 4 choices times a lot more choices.
To start with, why not have just a few choices:
Strike price=20 calls that expire end of June. Buy or Write
Strike price=20 calls that expire end of July. Buy or Write
Strike price=30 calls that expire end of July. Buy or Write.
You'd be offering 6 things that people could bid on. No puts (yet). No variable terms (dates and strike prices) that people can enter.
2) Explain, for the first 6 offerings, what needs to happen for someone to make money, with examples. Maybe a Javascript calculator that helps new users to plug in some numbers and see what happens in each case.
3) By default, use the Clearcoin escrow service for the first month or so. Have this as a part of the offering (included in the price of the service). After a month or two, then make it a chargeable extra. At that point, people can trust you as the escrow, or trust Clearcoin for an extra fee. (I'm just trying to think of ways that you can overcome the challenge "why should I trust you?"
4) Market this outside of the Bitcoin forums. "Think Bitcoin is a Pyramid Scheme, destined to fail? Write some calls, and benefit from your wisdom."
5) optionally.... if you think Bitcoin advocates will be the "easier sell" than Bitcoin nay-sayers, then disregard what I said in item 1, and ONLY offer 6 put choices, and no call choices. People who write puts would put up the BTC collateral, and people who buy the puts would only have to put up the premium. Offer the puts in USD, not BTC, as the people who are hard to get in on the transaction won't want to deal in BTC. Example: For $4, you can buy the right to make someone pay you $15 for 1 BTC. If they crash to zero, you'll make $15 (less the $4 you paid).
That's all I have. Hopefully this will take off!
Andy asked if we pay interest on USD or BTC. The answer is no, sorry to be so cryptic!
Quote from: bitoption
Totally; tweet away to him.
I don't have twitter, but I think cypherdoc is going to do it.
Quote from: bitoption
Re: interest -- nope.
Sorry, I don't get it.
Totally; tweet away to him.
Re: interest -- nope.
Re: interest -- nope.
I fear most of us are super-bull or mega-bull, wonder who will be first to place some put asks
http://twitter.com/#!/TYLERCOWEN
"When will there be a market, if only on InTrade.com, to short BitCoin?"
We should tell this guy about bitoption.
if you're locking up / escrowing funds for the duration of the option, is interest or similar paid?
Update: If you click on "USD-BTC" at the top, you can see the prices inverted. Also, Mt. Gox at the money is updated every three seconds now.
You still have to place your trades in BTC-USD, but this helps, I think.
A little bit better every day!
Re: mega-bulls, there are a lot of economists and bloggers who keep promising to take the other side of this trade. I'd love to see a grassroots "come on, put your money where your mouth is" short campaign.
You still have to place your trades in BTC-USD, but this helps, I think.
A little bit better every day!
Re: mega-bulls, there are a lot of economists and bloggers who keep promising to take the other side of this trade. I'd love to see a grassroots "come on, put your money where your mouth is" short campaign.
I qualify as a super-bull. Why not throw a few BTC into some outrageous trades 6 to 12 months from now?
I fear most of us are super-bull or mega-bull, wonder who will be first to place some put asks
btw. a great free tool for constructing option-orgies: http://www.samoasky.com/ and for that matter also for calculating potential income/loss on single options
I qualify as a super-bull. Why not throw a few BTC into some outrageous trades 6 to 12 months from now? That's my plan once programming slows down a bit.
I made a major update to the initial post; thanks for the tips. dacoinminster; your math wasn't right, you might want to review mine if you've made any trades! I want you to make money. : )
Thanks for the correction. I didn't trade, because I knew I probably wasn't understanding things well enough. Also, I'm way too chicken to trade bitcoin options. Just owning my few bitcoins is all the excitement I need - the people trading options are going to be a combination of starry-eyed idiots and really smart people with cast-iron stomachs. I'm just smart enough to know I'm not smart enough
Re: risk spreads: yes. I expect some significant automated trading coming soon; I'm hoping those guys get everybody riled up and using the site.
I made a major update to the initial post; thanks for the tips. dacoinminster; your math wasn't right, you might want to review mine if you've made any trades! I want you to make money. : )
Nonexistence of nonexistant as a word is confirmed. Thanks for the catch.
Longmarch, frustrating! I just registered and logged in successfully with a trial login. I'm guessing (hopefully politely) it's user error right now. I should have password resets running shortly, so you can use your second login (that one had an email attached to it). For my records, what browser/OS are you using? I assume you're using the site, not the API?
I made a major update to the initial post; thanks for the tips. dacoinminster; your math wasn't right, you might want to review mine if you've made any trades! I want you to make money. : )
Nonexistence of nonexistant as a word is confirmed. Thanks for the catch.
Longmarch, frustrating! I just registered and logged in successfully with a trial login. I'm guessing (hopefully politely) it's user error right now. I should have password resets running shortly, so you can use your second login (that one had an email attached to it). For my records, what browser/OS are you using? I assume you're using the site, not the API?
BTW, it's a lot more fun to play the lottery than to run the lottery, but it is a lot more profitable to run the lottery, especially when it comes to options.
Smart money is going to be collecting huge money here soon in the form of a "volatility risk premium" on out-of-the-money options (http://www.cxoadvisory.com/volatility-effects/the-why-of-the-volatility-risk-premium/)
Please don't ask me to explain any of this stuff. I'm barely smart enough to link to it.
Smart money is going to be collecting huge money here soon in the form of a "volatility risk premium" on out-of-the-money options (http://www.cxoadvisory.com/volatility-effects/the-why-of-the-volatility-risk-premium/)
Please don't ask me to explain any of this stuff. I'm barely smart enough to link to it.
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