Skip to main content
Learn

What Are the Risks of Writing a Put Option?

The main risk is the crypto price falling, forcing the writer to buy the asset at a price higher than its market value.
Greeks.Live28.10.25

What Are the Risks of Writing a Put Option?

The primary risk of writing a put option is a sharp decline in the price of the underlying cryptocurrency. If the price falls below the strike price, the writer is obligated to buy the crypto at the higher strike price from the option holder.

This means they could be forced to purchase an asset for a price significantly above its current market value. The maximum potential loss is substantial and occurs if the crypto's price drops to zero, forcing the writer to buy a worthless asset at the strike price.

How Does a “Put Option” Allow a Trader to Profit from a Falling Asset Price?
What Is the Difference between a Covered and a Naked Option Writer?
What Is the Primary Risk When Writing (Selling) a Naked Call Option?
What Is the Primary Role of a Crypto Option Seller (Writer)?

About

Contact

Editorial Policy

Terms of Service

Privacy Policy

Cookie Policy

© 2025 Greeks.Live

All Rights Reserved

Greeks.Live RFQ

Build by Noo on Engine

Source: The content on this website is produced by Greeks.live's proprietary analysis systems, which utilize advanced Large Language Models (LLMs). This information might not be subject to a full human review before publication and may contain errors.
Responsibility: You should not make any financial decisions based solely on the content presented here. We strongly urge you to conduct your own rigorous due diligence and to consult a qualified, independent financial advisor.
Purpose: All information is intended for informational purposes only. It should not be construed as financial, investment, trading, or any other form of professional advice. News and data are not trading signals.
Risk: The cryptocurrency, derivatives, and options markets are highly volatile and carry significant risk. By using this site, you acknowledge these risks and agree that Greeks.live and its affiliates are not responsible for any financial losses you may incur.