الخيارات

In every financial market, contracts form the basis of things. Contracts are legally binding agreements designed to serve specific purposes and needs. In financial markets, contracts are drafted to generate profit and are also known as "financial instruments" — abstract tools designed to generate profit.

One of these tools developed to achieve profit is options. Like other derivatives, options contracts follow the price of the underlying asset, meaning their value greatly depends on the price of other instruments (cash or derivatives). An option is a contract that grants the party the right to buy/sell a financial instrument at a predetermined price, on or before a predetermined date.

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Options vs Perpetual Contracts
Perpetual futures contracts (or simply, perpetuals) are contracts with no expiration date. They allow traders to close their positions (if they are profitable) at any time. Sometimes, their positions may be liquidated if the market moves against their expectations due to the leverage used to open such positions.

This means that all perpetual contracts are settled in cash, as there is no expiration date for them to be physically settled. That is, all perpetual contracts are of the American style.

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How Cryptocurrency Options Work
As contracts, options typically involve two parties: a trader and an exchange. The option seller places a contract order on the cryptocurrency exchange, specifying the expiration date and strike price. Then, the exchange matches a buyer with the order.

To ensure fairness, the premium cost is determined based on the remaining duration of the contract before expiration, the volatility of the underlying asset, the market price of the underlying asset, and interest rates.

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Options vs Futures
These two types of financial derivatives are remarkably similar, as both track underlying assets and allow people to speculate on them. They also allow traders to take long (buy) and short (sell) positions.

However, their features differ slightly in their modes of operation. Let’s see how.

An options contract allows you to buy an underlying asset at a price other than the current market price. It also gives you the "option" to buy/sell the underlying asset. However, in a futures contract, this action is obligatory, a commitment that does not depend on the discretion of the contract holder. This means that if the market moves against the direction of the futures contract, the position will be closed at the expiration date. Since it is a type of smart contract, it can execute itself.

Compared to options contracts, futures contracts involve high risk/high reward. Unlike options contracts, where the maximum potential loss is limited to the premium paid for the contract, with a futures contract, the loss depends on how much the price moves away from your entry point at the expiration date. The risks are high with futures: while there is a chance to make a lot of money, you can also lose a lot of money.