How Does Oracle Latency Impact the Pricing of Short-Dated Options? ⎊ Path

How Does Oracle Latency Impact the Pricing of Short-Dated Options?

Oracle latency, the delay between a price change and the oracle updating the on-chain price, significantly impacts short-dated options. These options are highly sensitive to small, rapid price movements.

High latency means the on-chain price used for execution is stale, leading to incorrect option pricing and potentially enabling arbitrage. Low latency is critical for accurate risk management and fair execution.

How Does a Change in Implied Volatility Affect the Price of Out-of-the-Money (OTM) Options?

How Does ‘Data Latency’ Impact the Fairness of Options Settlement via Smart Contracts?

How Does Oracle Latency Affect the Slippage and Execution Price on a Futures DEX?

What Is ‘Jitter’ and How Does It Contribute to Latency-Related Fill Rate Issues?

What Role Does Oracle Latency Play in Decentralized Derivatives Pricing and Arbitrage?

How Does High Network Latency Contribute to Stale Data Risk?

How Does Latency Affect a Market Maker’s Effective Fill Rate on an Electronic RFQ System?

Define “Oracle Risk” and Its Impact on Interconnected DeFi Protocols

Glossar

Oracle Latency Impact

Propagation ⎊ Oracle latency impact within cryptocurrency derivatives stems from the delay in external data feeds reaching smart contracts, directly affecting the accurate pricing and settlement of these instruments.