Deribit — the options exchange
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The DeribitDeribitA crypto options exchange. In our strategy this is where we buy put protection and sell covered calls.Read the lesson → links in this lesson are affiliate links. They cost you nothing extra, but the platform pays us a commission. It helps keep the school free.
Why Deribit?
DeribitDeribit is the largest crypto options exchange in the world — it concentrates most of the total crypto options trading volume. The exact market share shifts as competitors grow, but for SOLSOLSolana's native token. Used to pay gas and as collateral.Read the lesson → options it's currently the main venue.
Once you understand this one exchange, managing the entire options side of your strategy yourself — from buying protection to earning premium — becomes possible.
What is Deribit, in plain terms?
DeribitDeribitA crypto options exchange. In our strategy this is where we buy put protection and sell covered calls.Read the lesson → is like a store where you buy insurance for your crypto. You show up, choose which kind of insurance you want (a PutPutAn option type that grants the right to SELL at a set price. Used as insurance.Read the lesson → or a CallCallAn option type that grants the right to BUY at the strike price. The opposite of a put.Read the lesson →), pay for it — and you're covered.
DeribitDeribitA crypto options exchange. In our strategy this is where we buy put protection and sell covered calls.Read the lesson → is a centralized exchange (CEXCEXCentralized Exchange — a centralized exchange (e.g. Nexo, Kraken, Binance). Requires KYC.Read the lesson →). Your money sits in an exchange account — not in your own wallet. That carries a risk: the exchange could, in theory, fail. So we keep only the insurance budget here, not the whole portfolio.
Which options are available?
SOLSOLSolana's native token. Used to pay gas and as collateral.Read the lesson → options are growing quickly in popularity. For our strategy, the liquidity is sufficient.
How does settlement work?
DeribitDeribitA crypto options exchange. In our strategy this is where we buy put protection and sell covered calls.Read the lesson → uses cash settlement:
- The physical asset is never exchanged
- If your PutPutAn option type that grants the right to SELL at a set price. Used as insurance.Read the lesson → is $90 and SOLSOLSolana's native token. Used to pay gas and as collateral.Read the lesson → trades at $60, you simply receive the $30 difference in cash per contract (1 SOLSOLSolana's native token. Used to pay gas and as collateral.Read the lesson → option contract = 1 SOLSOLSolana's native token. Used to pay gas and as collateral.Read the lesson →)
- With 200 contracts that's 200 × $30 = $6,000
- No need to hand over any actual SOLSOLSolana's native token. Used to pay gas and as collateral.Read the lesson →
It's simple — you just receive (or pay) the cash difference.
What do you see in the options table?
When you open the DeribitDeribitA crypto options exchange. In our strategy this is where we buy put protection and sell covered calls.Read the lesson → options page, you see these columns:
| Column | What it shows | Example |
|---|---|---|
| Mark Price | The option's current price | $6.50 per contract |
| IV (implied volatility) | The market's expected volatility, in percent | 74% |
| Delta | How much the option's value changes when SOLSOLSolana's native token. Used to pay gas and as collateral.Read the lesson → rises $1 | -0.42 |
| Theta | How much value it loses per day | -$0.0163 per contract |
| Bid / Ask | The buy and sell prices | $6.40 / $6.60 |
| Volume | How many trades happened today | 150 |
| Open Interest | How many open positions exist | 2,400 |
In the example — our strategy's Long PutPutAn option type that grants the right to SELL at a set price. Used as insurance.Read the lesson → $90. SOLSOLSolana's native token. Used to pay gas and as collateral.Read the lesson → options are quoted in dollars (BTC options are quoted in bitcoin itself).
The Greeks shown are PER CONTRACT
In the DeribitDeribitA crypto options exchange. In our strategy this is where we buy put protection and sell covered calls.Read the lesson → table, delta and theta are per-contract figures. To get the position-level number, multiply by quantity: 200 contracts × (-0.42) = -84 delta, 200 × (-$0.0163) ≈ -$3.25 per day. These are the position-level numbers used in the other lesson examples.
Bid/Ask spread — the gap between the buy and sell price. The smaller it is, the better for you. In the example: ($6.60 − $6.40) / $6.50 ≈ 3%.
Account structure
Your DeribitDeribitA crypto options exchange. In our strategy this is where we buy put protection and sell covered calls.Read the lesson → account has these elements:
| Element | What it means, in plain terms |
|---|---|
| Equity | Your account's total value |
| Initial Margin | How much is needed to open a new position |
| Maintenance Margin | How much you need to keep the position from being closed |
| Available Balance | How much free cash you can use |
When you sell options (going short), DeribitDeribitA crypto options exchange. In our strategy this is where we buy put protection and sell covered calls.Read the lesson → requires collateral. In our strategy, the insurance budget (~1/3 of the borrowed USDCUSDCA USD stablecoin issued by Circle. Regulated, audited monthly. Our primary stablecoin and loan asset in the Kamino/Aave strategies.Read the lesson →) covers these requirements.
Your first trade — step by step
Here's what the process looks like technically on the exchange. This is an explanation, not a prompt to open a position: every options exercise in this course stays paper-only, and the decision to trade is entirely yours.
- Sign up — create an account at deribit.com, you'll go through identity verification
- Transfer funds — send USDCUSDCA USD stablecoin issued by Circle. Regulated, audited monthly. Our primary stablecoin and loan asset in the Kamino/Aave strategies.Read the lesson → (or BTC) to your DeribitDeribitA crypto options exchange. In our strategy this is where we buy put protection and sell covered calls.Read the lesson → account
- Go to options — select the "SOLSOLSolana's native token. Used to pay gas and as collateral.Read the lesson → OptionsOptionA financial contract that grants the right (but not the obligation) to buy or sell at a set price.Read the lesson →" menu
- Pick a date — choose an expiry roughly 120 days out
- Find the strike — locate the price you want in the table
- Pick the type — the CallCallAn option type that grants the right to BUY at the strike price. The opposite of a put.Read the lesson → or PutPutAn option type that grants the right to SELL at a set price. Used as insurance.Read the lesson → column
- Open the order — choose Buy or Sell, set the quantity
- Limit order — set the price between bid and ask (never use a market order)
- Confirm — review and confirm the trade
Order types
| Order type | When to use it | Risk |
|---|---|---|
| Limit (set-price order) | Always (recommended) | May have to wait, but you control the price |
| Market (current-price order) | Only for very urgent cases | Could buy at too high a price |
| Stop-Limit (automatic stop order) | Automatic position closing | May not trigger during a sharp move |
Why only limit orders?
In the options market, the bid/ask spread can run 3-5%. A market order buys at the most expensive price — you'd lose 3-5% instantly. Always use a limit order at the midpoint price and wait patiently.
How Deribit is used in our strategy
Two different bases — don't mix them up
In the portfolio, the collateral we hold is 126 SOL. The numbers in the options rows (200, 100, 50) are contract quantities, not the portfolio size (1 contract = 1 SOLSOLSolana's native token. Used to pay gas and as collateral.Read the lesson →). So whenever you calculate P&LP&LProfit & Loss — used to evaluate strategy results.Read the lesson →, always state which base you're using: portfolio value is calculated from 126 SOLSOLSolana's native token. Used to pay gas and as collateral.Read the lesson →, while an option's payout is calculated from that option's own contract quantity.
What it costs:
- Paid for insurance: ~$1,300
- Received from sales: $500 + $300 + $100 = ~$900
- Net cost: ~$400 over the 120-day cycle (the net cost of the Put SpreadPut SpreadLong put + short put. Cheaper protection than a plain put, but with limited coverage.Read the lesson → piece alone is $1,300 − $500 − $300 = $500)
Deribit API integration
Our platform pulls data from DeribitDeribitA crypto options exchange. In our strategy this is where we buy put protection and sell covered calls.Read the lesson → automatically:
- OptionOptionA financial contract that grants the right (but not the obligation) to buy or sell at a set price.Read the lesson → prices and Greeks in real time
- Your list of open positions
- Account status
Nothing needs to be calculated by hand — the platform keeps everything updated itself.
Next step: now let's take a closer look at how a PutPutAn option type that grants the right to SELL at a set price. Used as insurance.Read the lesson → option works as portfolio insurance.
Before you ever place a real trade, you need to be able to judge liquidity. This paper exercise (~15 min) teaches you to read the bid/ask spread and Open Interest — no signup, no purchases.
We're looking and calculating, NOT trading. No signup, no transfers — this is a learning exercise.
This is learning, not investing — use only small amounts you treat as tuition.
You just learned to read an options table and judge spread cost — a skill most crypto users never pick up.