1/ We get asked this question a lot, “$BTC is going up why isn’t my call making money?”

Options are interesting because they don’t have a linear payoff. This means if the underling to which they are tied goes up ($BTC), the value of the option doesn’t necessarily go up. 2/ Short answer, Option prices are derived from the Greeks, we have talked about this ad nauseum, but here is a short, useful example.

1/ If you haven't read the Coinvexity article by @laevitas1, @Mtrl_Scientist, and @bit_hedge we highly recommend you do so.

But incase you are too lazy to click the link, I'll give you a few of the highlights. 🧵
coinvexity.substack.com/p/coinvexity-2… 2/ After Souschef uses a few technical terms to describe monetary policy he picks apart a few Option strategies to deduce sentiment.

This is a really cool tool from @laevitas1!

1/ For all the newbie Option traders asking about volatility here is the TLDR thread on IV. 🧵⚡️

Hopefully this clears a few things up. 👍 2/ IV is actually just the expected move of a certain percent over a defined amount of time.

So if IV is 60%, #BTC has the potential to move 60%.

1/ The term EV gets used a lot on CT, and yet I meet people who have no clue what it means constantly. ⚡️

So I am going to take a moment out of my day to explain to you Expected Value. 🧵 2/ Expected value (EV) is the sum of the probability weighted outcomes. Here is an example, let’s say you have five pieces of paper in a velvet bag, all of them numbered 1-5. If you pull any one number, you will have a 20% chance of choosing any of them. (1/5=.2)

1/ Here is a great thread outlining what's going on mechanically in the crypto Option markets regarding Decentralized Option Vaults (DOV's) and IV.

Read it for yourself and I will break part of it down below in "ELI5" style.

https://twitter.com/adi_dommaraju/status/1478788532659314690?s=21

2/ To understand this thread you need to have a slight understanding of gamma and how MM (Market Makers) operate. The mechanics are explained well here. 👇

https://twitter.com/ResearchVariant/status/1421514329975783426

1/ I've seen many of you asking what the heck this is and how to interpret it. So over the course of this brief thread I will explain the basics.⚡️

This is TLDR on Term Structure. 🧵 2/ Term structure simply displays the ATM (at the money) IV (Implied Volatility) of different expirations. In the above example it looks like 17DEC ATM IV is around 78-ish, and 28Jan22 is over 85 IV.

1/ We are in the season of UpOnly and you most likely don’t want to give up exposure to #BTC’s upside, but what if you want to use your capital efficiently and earn a kicker on your coin. ⚡️

Enter the Short Put Spread.🧵 2/ It’s a simple concept. Sell one put a little OTM, buy one put even further OTM.

I'll break it down for you. Let’s build a Put Spread step by step.

1/ Today we saw a good amount of #BTC puts sold. So I wanted to explain how that works and why one might do that.⚡️

This is a short thread on selling puts! 🧵 2/ When you buy a put you are essentially buying insurance incase #BTC’s price starts to tank. This cost a premium, but when you sell a put you collect that premium. We discussed this in our previous thread on buying and selling calls.

https://twitter.com/PowerTradeHQ/status/1433436914149781508

1/ PowerTrade #GreekWeek Day 2 - GAMMA

I’m sure you have heard it mentioned all over twitter, and it might seem a bit confusing, but in this #PowerKnowledge thread we are going to demystify Gamma and explain it in simplest of terms.

Gamma NFT Drop at the end... 2/ Gamma is the rate of change in Delta. If you don't remember Delta, here is our thread from yesterday explaining it.

TLDR: Delta measures change in the option price for every one dollar move, and gamma measures the change in Delta.

https://twitter.com/PowerTradeHQ/status/1435237755500519429

1/ Today in our #Powerknowledge series we are going to talk about what happens when you buy or sell Call?

Over the course of this series we will talk about Greeks, Volatility, Leverage, and Spreads, but first we must build a foundation.

A thread. 🧵👇 2/ So what is a Call? I'm sure you have heard it 100 times, a call is the right (but not the obligation) to buy $BTC at a certain price, within a certain time period.