What in the world made you think of options when all you need to do is just bet straight up. If bitcoin is over $1000 on Dec 31, 2014 he owes you x, if its below you owe him x.

I am not an expert with options but if you really are hell bent on muddying the water, I would suggest reading up on the Black-Scholes models. You can plug in variables(implied volitility, betas etc) into the equations. Good luck.

http://www.soarcorp.com/black_scholes_calculator.jsp