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How Can a Covered Call Strategy Be Used to Generate Income from Locked Governance Tokens?

Sell a call option on the held tokens to earn premium income, capping upside but lowering cost basis.
Greeks.Live06.11.25

How Can a Covered Call Strategy Be Used to Generate Income from Locked Governance Tokens?

A covered call strategy involves holding a long position in the governance tokens (the "cover") and simultaneously selling (writing) a call option on those same tokens. The premium received from selling the call option generates immediate income.

If the token price stays below the strike price, the holder keeps the premium and the tokens. This is a conservative strategy to earn yield while holding a long-term governance stake.

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