How Do High Gas Fees Specifically Affect the Pricing Models of Options Contracts Deployed as Smart Contracts?

High gas fees directly increase the cost basis of creating, trading, and settling options contracts on-chain. This added cost must be factored into the option's premium, potentially making it uncompetitive compared to traditional markets.

For complex options strategies that require multiple transactions to establish or adjust a position, unpredictable gas fees can introduce significant execution risk and uncertainty. Furthermore, high fees can deter the frequent, small-value transactions often needed for dynamic hedging strategies, thereby limiting the types of options that can be viably offered.