Quote from: right wing authoritarian on August 12, 2014, 05:31:12 AM

Quote from: Keyara on August 10, 2014, 09:05:02 PM

Quote from: Mobius on August 10, 2014, 09:00:00 PM

Quote from: right wing authoritarian on August 06, 2014, 04:08:33 AM

Quote from: TwinWinNerD on August 05, 2014, 10:50:24 PM

Quote from: JackTackett on August 05, 2014, 10:37:18 PM

Quote from: right wing authoritarian on August 03, 2014, 11:45:30 AM

I just sold a call option to a forum member. Deal was by private negotiation. It is not that hard.

Curious as to how you all priced the option? What sort of assumptions etc. I am assuming given the unknowns using something like Black-Sholes would not be useful.

Thanks,
Jack

If you are intersted in pricing BTC options, this thread could be a good read for you!

https://bitcointalk.org/index.php?topic=557743.0

I just accepted a bid. I did use Black-Sholes to check that the bid was reasonable, the problem is working out what kind of volatility to use. Current volatility is lower than historical volatility. So it depends on what you believe about the future volatility of bitcoin. My view is that past volatility is more to do with Gox than bitcoin and Gox is gone thankfully.

Also the trade was purely trust based (offered escrow but for the amounts involved the buyer was unconcerned). In the long term this is the only way any business can be sustained. Look at services like "spendbitcoins" he has been going since very early days and never ripped anyone off. I would be confident to make a million dollar trade with him because of his record. I would be willing to take the risk of a small trade with someone new to see where it goes and in that fashion one can build trust over time. Any scam involving options can only last until someone tries to exercise. So as long as people are trading relatively short dated contracts a scam would not be able to be sustained. The main issue is the risk that an option writer dies or goes broke and that is where collateral and escrow will become important.

I would be very surprised that the buyer would decline escrow for this kind of transaction unless the call option was for well under 1 BTC. The buyer would not only need to trust that you would honor your agreement, but also trust that you would not just keep his $1,100 or however much money (per BTC) when he sends it to you when he exercises his option.

He is making false claim for a deal.

He needs to post the blockchain transaction and deal to prove otherwise.

How much BTC would you be willing to bet that the claim is false?

I would bet .01 that it is true but there is really no way of knowing for sure. The Op could easily fake a TX and a 2nd person to do the option with. I think a lot of people are watching this thread for educational purposes as long term options for bitcoin could dramatically change the bitcoin related economy.