How does the strategy of covered call vs cash secured put apply to cryptocurrency trading?

3 answers

• Rivera GainesMay 20, 2021 · 5 years ago
  Using the strategy of covered call in cryptocurrency trading involves selling call options on a cryptocurrency that you already own. This allows you to generate income from the premiums received from selling the options, while still benefiting from any potential price increases in the cryptocurrency. However, there is a risk of missing out on significant gains if the price of the cryptocurrency rises above the strike price of the options. It's important to carefully consider the potential gains and risks before implementing this strategy.
  544

  272
• Marc LJul 24, 2021 · 4 years ago
  When it comes to cash secured put strategy in cryptocurrency trading, it involves selling put options on a cryptocurrency that you are willing to buy at a specific price (the strike price). By selling the put options, you can generate income from the premiums received. If the price of the cryptocurrency remains above the strike price, the options will expire worthless and you keep the premium. However, if the price falls below the strike price, you may be obligated to buy the cryptocurrency at the strike price. This strategy can be beneficial if you are bullish on a particular cryptocurrency and are willing to buy it at a predetermined price.
  650

  217
• Sandro CristianoFeb 07, 2025 · 10 months ago
  BYDFi, a digital asset exchange, offers the option to trade cryptocurrency using the covered call strategy. This strategy allows traders to generate income from selling call options on their existing cryptocurrency holdings. It can be a useful tool in managing risk and generating additional income in the volatile cryptocurrency market. However, it's important to note that this strategy also comes with risks, such as potential missed gains if the price of the cryptocurrency rises significantly. Traders should carefully consider their risk tolerance and market conditions before implementing this strategy.
  610

  153