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How Can Options Be Used for Hedging a Cryptocurrency Portfolio?

Buying protective put options to offset potential losses from a price decline in the underlying crypto asset.
Greeks.Live28.10.25

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.

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