Scenario 3

Collateral: Cash (SOL) & Payout: Cash (SOL)

A seller, who is owning a DeGod but doesn’t want to risk it in case of a failed bet, has decided to challenge the option parameters and to change both the collateral to “Cash” (200 SOL) and the payoff to “Cash” (200 SOL).

The buyer has agreed on those new terms.

• Option type: Call

• Underlying asset: DeGod NFT

• Strike price: 375 SOL

• Expiration: 30 days

• Premium: 37.5 SOL

• Collateral: Cash (200 SOL)

• Payoff: Cash (200 SOL)

- The buyer pays the seller a 37.5 SOL premium.

- The seller is putting 200 SOL as collateral.

- The buyer is receiving a new NFT that materializes the call option contract. If he activates his option he will earn the difference between the current floor price of the underlying asset (DeGod NFT) and the strike price (for a maximum of 200 SOL which is the agreed payoff).

Outcome 1

After 25 days, DeGods has finally revealed its roadmap v2.0 and price has increased to 600 SOL.

The buyer decides to activate his option. The seller has to pay him the difference between the current DeGods floor price (600 SOL) and the option’s strike price (375 SOL) which is 225 SOL. Unfortunately for him, the buyer has agreed on a 200 SOL maximum payoff which is the maximum amount of money he can expect from the seller.

• Buyer has made 200 (100% of the payoff) - 37.5 (premium) = 162.5 SOL

• Seller has lost 37.5 (premium) - 200 (100% of the payoff) = 162.5 SOL

Outcome 2

After 25 days, DeGods has finally revealed its roadmap v2.0 (after multiple DeLays) and price has increased to 500 SOL.

The buyer decides to activate his option. The seller has to pay him the difference between the current DeGods floor price (500 SOL) and the option’s strike price (375 SOL) which is 125 SOL.

• Buyer has made 125 (62.5% of the payoff) - 37.5 (premium) = 87.5 SOL

• Seller has lost 37.5 (premium) - 125 (62.5% of the payoff) = 87.5 SOL

Outcome 3

After 30 days, DeGods is still DeLaying its roadmap 2.0 reveal and floor price has dropped to 350 SOL.

Because the current floor price of DeGods is below the strike price of the Call option, the buyer cannot activate it, the NFT materializing the option is burnt after the expiration date has been reached.

• Buyer has lost 37.5 SOL (premium)

• Seller has made 37.5 SOL (premium)