This is essentially a covered call strategy 🤽🏼‍♂️

matrixport

Deribit.com 11/25/2020

We have the following instrument on matrixport

Strike price: $660 / ETH

Underlying price (11/25/2020): $608.66

Invest: 10 ETH

Case 1

on expiry if strike price < $660, receive 10.316 ETH

0.316 ETH = 193.18 USD

profit = 193.18

Case 2

on expiry if strike price ≥ $660, i receive $6,808.56 USD

since I want to keep ETH, to hedge, I buy a deribit option to buy back 10 ETH at a strike price of $6,600

the price for 10 ETH option cost me $91.70

Profit = $6808.56 - $6,600 - $91.70= $118.56 USD

ill then spend 6,600 USD and buy back my original 10 ETH

If case 2 sounds complicated to you, it's actually fine to ignore the hedge strategy, and in this case the system automatically helps you to sell your ETH at an all time high

After that just take the cash that you got from selling ETH and put it in an instrument that does the reverse of the above to buy back ETH when it's all time low.

what are the risks?

you may not find the cheapest possible option price to hedge, and hence u might end up losing your ETH and forsake the upside of ETH goes to the moon
Counterparty risk (duh)
You need to find the correct strike price pairing to hedge it properly (ie: its not always the case in which you can find an option seller at the right price and right strike price on the right strike day)

binance also has dual savings.

below seems wrong? should buy a call option instead to hedge

or sell a put option?

maybe yield on option = 50% margin of error so still doable?

https://twitter.com/thetaseek/status/1316248615854112768?s=20