How Can Options Be Used for Hedging a Cryptocurrency Portfolio? ⎊ Path

How Can Options Be Used for Hedging a Cryptocurrency Portfolio?

Options can be used to hedge against downside risk by buying protective put options on a cryptocurrency or a crypto-related ETF. If the price of the underlying asset falls, the gain from the put option offsets the portfolio loss.

This strategy limits potential losses while allowing the portfolio to benefit from price appreciation.

What Is a “Protective Put” Strategy?

What Is a Protective Put Strategy in Options Trading?

What Is a “Bear Put Spread” and How Does It Limit Risk Compared to Buying a Single Put?

How Can a Portfolio Manager Use Derivatives to Hedge against the Risk of Token Governance Changes?

How Can Options Be Used to Hedge a Long Position in a Cryptocurrency?

Provide a Simple Example of a Protective Put Strategy for Bitcoin

Can a Validator Use a Futures Contract to Hedge the Price Risk of Their Staked Assets?

What Is the Term for Holding an Asset and Buying a Put Option?

Glossar

Protective Put Options

Framework ⎊ Protective put options, within the cryptocurrency derivatives landscape, represent a strategic hedging mechanism designed to mitigate downside risk while retaining potential upside exposure.