Hegic protocol is an options trading protocol that allows users to buy call/put options in a permissionless and non-custodial way. Liquidity providers send ETH/WBTC to Hegic’s pool to receive writeETH/writeWBTC, which represents a stake in the pool’s written options. The liquidity is shared among different options and among all liquidity providers to diversify risks. Liquidity providers earn a premium from selling options. When an option expires, options buyers have the option to receive their profits if they are in the money. Contrary to Hegic v1, where put options’ profits are paid in DAI, Hegic v888 pays out put options profits in their underlying assets.
Dissecting the Hegic protocol
Dissecting the Hegic protocol
Dissecting the Hegic protocol
Hegic protocol is an options trading protocol that allows users to buy call/put options in a permissionless and non-custodial way. Liquidity providers send ETH/WBTC to Hegic’s pool to receive writeETH/writeWBTC, which represents a stake in the pool’s written options. The liquidity is shared among different options and among all liquidity providers to diversify risks. Liquidity providers earn a premium from selling options. When an option expires, options buyers have the option to receive their profits if they are in the money. Contrary to Hegic v1, where put options’ profits are paid in DAI, Hegic v888 pays out put options profits in their underlying assets.