How Does the Smart Contract Handle the "Premium" Payment for an Option? ⎊ Path

How Does the Smart Contract Handle the “Premium” Payment for an Option?

The option premium, which is the price paid by the buyer to the writer (seller), is transferred instantly and automatically via the smart contract upon the option's minting. The contract locks the premium in a secure manner and releases it to the option writer, while simultaneously minting the option token for the buyer, ensuring an atomic exchange of value.

How Does a Smart Contract Handle the Conversion of Collateral to Stablecoins upon Liquidation?

What Is the Difference between Minting and Burning a Stablecoin?

Explain the Risk-Reward Profile for an Option Writer Compared to an Option Buyer

How Does the ‘Burning’ and ‘Minting’ Mechanism Help a Stablecoin Maintain Its Peg?

In Options Trading, What Specific Risks Does Novation Mitigate for the Option Writer?

How Does a Smart Contract Handle the Clearing and Settlement Process on a DEX?

How Do Decentralized Options Protocols Handle Delivery Risk without a Central Clearing House?

What Is the Role of the Payment System in Facilitating Both Gross and Net Derivatives Settlement?

Glossar

Tokenized Options Protocol

Framework ⎊ A tokenized options protocol is the decentralized framework, built upon smart contracts, that facilitates the permissionless creation, trading, and settlement of crypto derivative contracts.