Develop some sort of volatility hedge using the BTCVol.info API and use the decentralized ledger of Counterparty to distribute ownership.
Contracts would have have intrinsic value but liquidity for the market would have to come from independent market makers.
Contracts would have have intrinsic value but liquidity for the market would have to come from independent market makers.
btcvol.info's volatility calculation methods is quite basic. You can use R to get a much better calculator: http://www.inside-r.org/packages/cran/TTR/docs/volatility
BTW, to trade volatility, you can also try bitcoin options https://coinut.com
Coinut looks like a cool project. There needs to be some more liquidity though.
