BC CRYPTO
Saved by @CodyyyGardner

1. Congrats to the @opyn_ team for launching V2 - very exciting! I’m happy that the new V2 dashboard has a clean layout with greeks and implied vols for each respective option. It’s also a pleasant surprise to see the prices are closely in line with @DeribitExchange's options.

 2. Many folks in this space use options to make directional bets on the underlying price of an asset ie: if we’re bullish or bearish we can buy a call or put respectively. Things get interesting when we move beyond simply trading the direction of where BTC or ETH is going...
3. Unlike futures, with options we can make bets on the underlying volatility of an asset. This style of trading is commonly referred to as “vol trading” which is a slightly more advanced strategy used by sophisticated retail traders and institutions such as @ledger_prime.
4. Below are a few key terms we need to understand as vol traders:
- Realized Volatility
- Implied Volatility
- Delta
5. Realized volatility (a): the historical volatility of the underlying asset throughout the life of the option. This volatility is measured during a given time period - ie: volatility over a 30 day period. Below is a plot of realized ETH vol from @GenesisVol data.
6. Realized Volatility (b): There’s no set way to measure realized vol rather it needs to be estimated. A decent aprx is to use the annualized stdev of log returns of the underlying asset. For those interested in fancier models, consider checking out Yang-Zhang or Garman-Klass.
7. Implied Volatility (a): This is the market’s *future estimate* of the underlying's realized volatility when the option matures. For example, if we have a 30 day option with an IV of 90%, then the market is implying the underlying asset will realize a vol of 90% across 30 days.
8. Implied Volatility (b): Options are priced in terms of IV which reflects the market's consensus for future vol. Our job as vol traders is to assess whether IV is over or under valued relative to where we think actual realized vol will settle at expiry.
9. Implied Vol (c): If we think there's an upcoming market event which could increase realized vol (ie: SEC crackdown) that isn't currently reflected in the IV, then we could "go long vol". In this case we're betting on *realized vol* to be greater than the current IV at expiry.
10. Delta (a): Delta is how much the option value will change for a *small change* in the underlying asset. Calls have +delta and puts have -delta (ie: calls increase in value as spot rises whereas puts decrease in value as spot rises).
11. Delta (b): With @opyn_ options, if a put has a delta of -0.40, this means for a $1 increase in the underlying, the value of the put should decrease by around $0.40. Conversely, a $1 decrease in the underlying will result in a +$0.40 change in the option value.
12. Delta (c): If we want to trade an option w/o worrying about the direction of the underlying price, we need to eliminate our delta exposure so we’re only trading the vol. Let's use a real-world example with @opyn_'s options.
13. We'll use the Jan. 29/2021, ETH $760 CALL as it's closest to at-the-money with a delta of +0.514. This means for a $1 increase in ETH we can expect a $0.514 increase in the option price (this is similar to being long 0.514 units of ETH).
14. The call option also has an IV of 107.59%. This means the market is expecting future ETH realized volatility to be 107.59% in ~ 30 days. Currently the realized ETH vol is around 108% based on @GenesisVol's data.
15. If we believe that realized vol will be far higher than its current level of around 108% in 30 days time, then we could place a "long vol" trade - ie: a bet on higher realized volatility.
16. To place this long vol trade using the call, we need to eliminate our delta exposure so we’re only trading the vol. If we’re exposed to +0.514 units of ETH on the call then we need to short 0.514 units of ETH to neutralize our delta exposure.
17. In order to hedge our deltas, we can hop over to @dydxprotocol where we can use margin to short 0.514 units of ETH. In other words, we would end up shorting 0.514 ETH to remove our call option delta exposure (we get better tx fees when we trade in larger size on dydx).
18. As a recap:

LONG: Call Option: +0.514 ETH Delta
SHORT: @dydxprotocol ETH: -0.514 ETH Delta
------------------------------------------------
Net Portfolio Delta Exposure = 0
19. Note: The delta of the option is not constant and changes over time. This requires us to constantly rebalance our net delta exposure (dynamically hedge) so it stays low - recall we're trading vol not the underlying. A large absolute delta will give us exposures we don't want.
20. *Very important*: don't over-hedge your delta exposures! This will result in massive over-trading and any potential profits will be eaten up by gas fees + tx costs. Be sensible with your hedging frequency - not every move needs to be hedged.
21. At the end of the trade, if realized vol > the implied vol of when you bought the option, then you'll likely make money if you were able to keep your hedging costs low. This topic goes into much more detail in @SinclairEuan's great book on vol trading.
22. For experienced option vol traders - we can approximate the PNL from this trade with the following formula: option vega x (realized vol - implied vol).
23. It's quite amazing that we now have the tools and building blocks within the DeFi eco-system to play around with decentralized crypto vol trading - all thanks to the innovative projects in this space. Keep up the great work!
Any thoughts or suggestions with this explanation? @BitcoinMises @saah1lk @andrewjleone @kyled116 @fb_gravitysucks @SinclairEuan

More from Crypto

Jonty Wareing
Jonty Wareing
@jonty
Out of curiosity I dug into how NFT's actually reference the media you're "buying" and my eyebrows are now orbiting the moon

Short version:

The NFT token you bought either points to a URL on the internet, or an IPFS hash. In most circumstances it references an IPFS gateway on the internet run by the startup you bought the NFT from.

Oh, and that URL is not the media. That URL is a JSON metadata file

Here's an example. This artwork is by Beeple and sold via Nifty:

https://t.co/TlJKH8kAew

The NFT token is for this JSON file hosted directly on Nifty's servers:

https://t.co/GQUaCnObvX


THAT file refers to the actual media you just "bought". Which in this case is hosted via a @cloudinary CDN, served by Nifty's servers again.

So if Nifty goes bust, your token is now worthless. It refers to nothing. This can't be changed.

"But you said some use IPFS!"

Let's look at the $65m Beeple, sold by Christies. Fancy.

https://t.co/1G9nCAdetk

That NFT token refers directly to an IPFS hash (https://t.co/QUdtdgtssH). We can take that IPFS hash and fetch the JSON metadata using a public gateway:

https://t.co/CoML7psBhF
CRYPTO
Crypto Voices
Crypto Voices
@crypto_voices
Election day in US; to skip the politics and get straight to the money, here's our quarterly update. How do gold, silver, and government fiat money compare with bitcoin's 21 million? #Bitcoin is the 10th largest money in the world, ex-gold & silver. This is update #10.


2/ Bitcoin's monetary system marches on its continuously-lowering coin emission; meanwhile, other world monetary systems' units inflate, either naturally (like gold & silver ounces), or via monopolistic privilege (like government fiat money "printing").

3/ What follows isn't a lesson in stimulus or bailouts, whatever the world faces. It's an attempt at painting the monetary landscape around the globe. The dollars, euros, and yen we're all familiar with, collectively, are worth $25 trillion. This is an exercise in perspective.

4/ As many know, the response from governments worldwide to Covid-19 has been drastic, so expect big moves. Also interestingly, central banks have been much slower to update their data these days.

5/ Gold & silver is base money of the past. Government fiat is base money today. It comprises both physical cash… and a digital cash component. Bitcoin may be base money of the future. Before we get to the charts, it's important to clarify a few common misconceptions in money.
CRYPTO
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\U0001f42e Mikko Ohtamaa
🐮 Mikko Ohtamaa...
@moo9000
1/ Welcome to #DeFi Wednesday.

Let's talk about how interest-bearing cash on a blockchain is going to revolutionise boring corporate treasury management that concerns every company is is a larger business than all crypto trading in the world.

Enter the thread

👇👇👇


2/ Blockchain community is often seen as toxic maxis and redditors who shill other their weekly favourite shitcoin in the hope of getting Lambo.

Sometimes we also do things that progress humanity towards the better future and interest-bearing cash is one of those things.


3/ Less chad and more things that actually matter:

My incomplete theory of interest-bearing cash is also available also as a blog post:

https://t.co/uiG0fZiVyu

It is 15 pages. Pick your slow poison or die fast by continue reading here.

4/ First time in the history we have an ability to create interest-bearing cash-like instruments.

Interest-bearing cash ticks up dollar (euro) balance real-time in your wallet.

Here is a demonstration using @aaveaave aDAI, based on @makerdao DAI, and @TrustWalletApp


5/ Interest-bearing cash is not like your bank's saving account. Your money in a bank is not yours, but bank's. There are some flaws in the current banking system causing a headache for Chief Financial Officers (CFOs)
CRYPTO
Oliver Jumpertz
Oliver Jumpertz
@oliverjumpertz
"Blockchain technology is energy-intensive..." => No, it doesn't have to be.

Let's look at Proof-Of-Stake, an alternative to the energy-intensive Proof-Of-Work algorithm.

🧵🔽

1️⃣ A Quick Recap On Proof-Of-Work

A Proof-Of-Work algorithm requires miners to do a certain amount of work that is compute-intensive to gain access to a service or the right to do something. This algorithm, by design, also requires that the work done shall not ...

... be reusable for anything else than what it was performed for. This lies at the core of the security concept of a blockchain. To gain the right to append a new block to a chain and to get some currency as a reward, there is work to be done, and this work must be verifyable.

That work is a race between different miners. Many miners try to compete and to be the first to find the answer to a problem presented to them. This implies that a lot of energy is wasted as only the first correct solution is accepted.

You can find a more detailed thread on Proof-Of-Work
CRYPTO
David Fauchier
David Fauchier
@dfauchier
Some thoughts on this super inaccurate piece.

tl;dr: this is not a defence of Tether/ iFinex, who I would like nothing more than to see disappear into irrelevance. However, most of the conclusions here show zero understanding of crypto market

1. First up: it’s completely inexcusable that Tether refuse to have a 3rd party audit. I can’t find a single good faith reason for this.

Bitfinex GC recently did a superb job of sidestepping that question on WBD:

2. For better or worse, USDT (tether) started as a way for people to move fiat between exchanges (a major problem) in the absence of the ability to onboard banking partners, none of whom wanted to touch crypto. USDT is now the dominant stablecoin by mkt cap & liquidity.

3. As a result of the difficulty of having a fiat on/off rail, many exchanges, like Binance, chose to be ‘crypto only’, using stablecoins in lieu of fiat. This is why the majority of inflows into BTC (article says 70%) is via USDT

4. Unbanked exchanges are in aggregate larger than banked ones. This is true, but it’s not because of a giant conspiracy to steal your BTC. Being unbanked = real regulatory arbitrages (lower cost + ability to innovate fast), and lower barriers to entry means there’s more of them.
CRYPTO

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*The Evidence Collection*

There is overwhelming evidence of election fraud. Therefore it is the duty of the Executive, Legislative, & Judicial branches to throw out the fraudulent votes & to honor their oath to protect & defend the Constitution of the USA.🇺🇸🦅

A list below.🔻


1/ Navarro Report: The Immaculate Deception - Six Key Dimensions of Election Irregularities -

2/ Analysis of 3,000 U.S. counties shows Joe Biden received 5.6 % more votes in counties using Dominion Voting Systems (Video) -

3/ Antrim Michigan Dominion Voting Systems Forensics Report -

4/ Evidence Grows: ’20 Election Was Rigged -
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Vibhu Vashisth
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हिमालय पर्वत की एक बड़ी पवित्र गुफा थी।उस गुफा के निकट ही गंगा जी बहती थी।एक बार देवर्षि नारद विचरण करते हुए वहां आ पहुंचे।वह परम पवित्र गुफा नारद जी को अत्यंत सुहावनी लगी।वहां का मनोरम प्राकृतिक दृश्य,पर्वत,नदी और वन देख उनके हृदय में श्रीहरि विष्णु की भक्ति अत्यंत बलवती हो उठी।


और देवर्षि नारद वहीं बैठकर तपस्या में लीन हो गए।इन्द्र नारद की तपस्या से घबरा गए।उन्हें हमेशा की तरह अपना सिंहासन व स्वर्ग खोने का डर सताने लगा।इसलिए इन्द्र ने नारद की तपस्या भंग करने के लिए कामदेव को उनके पास भेज दिया।वहां पहुंच कामदेव ने अपनी माया से वसंतऋतु को उत्पन्न कर दिया।


पेड़ और पौधों पर रंग बिरंगे फूल खिल गए और कोयलें कूकने लगी,पक्षी चहकने लगे।शीतल,मंद,सुगंधित और सुहावनी हवा चलने लगी।रंभा आदि अप्सराएं नाचने लगीं ।किन्तु कामदेव की किसी भी माया का नारद पे कोई प्रभाव नहीं पड़ा।तब कामदेव को डर सताने लगा कि कहीं नारद क्रोध में आकर मुझे श्राप न देदें।

जैसे ही नारद ने अपनी आंखें खोली, उसी क्षण कामदेव ने उनसे क्षमा मांगी।नारद मुनि को तनिक भी क्रोध नहीं आया और उन्होने शीघ्र ही कामदेव को क्षमा कर दिया।कामदेव प्रसन्न होकर वहां से चले गए।कामदेव के चले जाने पर देवर्षि के मन में अहंकार आ गया कि मैने कामदेव को हरा दिया।

नारद फिर कैलाश जा पहुंचे और शिवजी को अपनी विजयगाथा सुनाई।शिव समझ गए कि नारद अहंकारी हो गए हैं और अगर ये बात विष्णु जी जान गए तो नारद के लिए अच्छा नहीं होगा।ये सोचकर शिवजी ने नारद को भगवन विष्णु को ये बात बताने के लीए मना किया। परंतु नारद जी को ये बात उचित नहीं लगी।
ALL
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Chris Herd
Chris Herd
@chris_herd
I've spoken to 1,500+ people about remote work in the last 9 months

A few predictions of what is likely to emerge before 2030

[ a thread ] 💻🏠🌍

🚜 Rural Living: World-class people will move to smaller cities, have a lower cost of living & higher quality of life

These regions must innovate quickly to attract that wealth. Better schools, faster internet connections are a must

⏰Asynchronous Work: Offices are instantaneous gratification distraction factories where synchronous work makes it impossible to get stuff done

Tools that enable asynchronous work are the most important thing globally remote teams need. A lot of startups will try to tackle this

⚽️Hobbie Renaissance: Remote working will lead to a rise in people participating in hobbies and activities which link them to people in their local community

This will lead to deeper, more meaningful relationships which overcome societal issues of loneliness and issolation

🌍Diversity & Inclusion: The most diverse and inclusive teams in history will emerge rapidly

Companies who embrace it have a first-mover advantage to attract great talent globally. Companies who don't will lose their best people to their biggest competitors
REMOTE WORK
Hector Navarro
Hector Navarro
@Hectorisfunny
I'm going to attempt to chronologically list all of the Marvel characters Stan Lee had a hand in creating. Working with his genius collaborators, Stan and his team produced an insane amount of iconic characters in a roughy ten year period. (Thread)


With his younger brother, writer Larry Lieber, and Jack "the King" Kirby:

Groot

Tales to Astonish #13 (November, 1960)


With writer Lieber, and artist Kirby:

Fin Fang Foom

Strange Tales #89 (October, 1961)


With the King, Stan gives birth to the Marvel Universe:

The Fantastic Four

Fantastic Four #1 (November, 1961)


With Jack Kirby:

Mister Fantastic

Fantastic Four #1 (November, 1961)
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Eric
Eric
@ericbahn
1/ Recently, I learned about the concept of ‘struggle porn’. This refers to the fetish of sacrificing nearly everything (health, relationships, time) for your startup. I fear that this label is creating more harm than good.

2/ @nateliason wrote a fabulous article about this topic, which first introduced me to this concept. Everyone should read it:

3/ @alexisohanian also recently spoke about struggle porn, though referring to it as ‘hustle porn.’ (as the co-founder of @hustlefundvc, obviously I take issue with this pejorative definition of ‘hustle’, but that’s another topic)

4/ Struggling in itself isn’t necessarily bad. Let’s be real here--if you’re going to start a startup, you will struggle. Founders should expect to work harder generally than employees. You will be challenged in many ways and also be super rewarded in others. This is normal.

5/ However, if you are over-indexing on hard work without clear purpose and degrading your mental health/relationships in the process--then this is very bad and we obviously should not celebrate this behavior.
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