crypto strategy

Will Options Vaults Dominate Real Return Products in Crypto?

Options strategies, in particular the weekly writing of covered call options, are a very popular return-generating mechanism used in TradFi.

United States Covered Call ETFs alone have a total of $12 billion under management, with the best performing ETF returning 19.47%.

According Flynt financingit is back test reportBitcoin covered calls have been shown to produce around 49% returns per year if the strategy is executed at a certain level of risk-reward.

An important factor to consider when executing the strategy is the selection of delta and leverage which can maximize returns while reducing the risk of being in the money.

Additionally, if 10 Bitcoins were invested in this strategy from April 2019, the current holdings would be 26.7 BTC. Due to the highly volatile nature of cryptocurrencies, profits are much higher compared to TradFi.

What are Covered Calls?

Covered calls are systematic options trading strategies that generate passive income by selling call options on an asset held by the investor on a weekly basis.

When selling options, the seller transfers the right to buy the asset at a specific price in exchange for a premium. The premium is then translated into a return on investment.

Although it sounds simple enough, it is important to keep in mind that the execution (strike) price must be selected carefully because it is the price that decides whether the investor ends up with a gain or a loss. loss for the week.

Based on the backtested results, the sweet spot that Flynt discovered managed to achieve a 96.4% win rate over 3.4 years.

Since the returns are created through the current covered call strategy, the actual return is achieved without false promises or token issuances, providing sustainable returns for investors.

Transparency is what you should be looking for

Against this backdrop, the market is still in a scary state of loan performance after the Terra Luna collapse, with memes circulating Twitter saying “if you don’t understand the source of the yield, then you are the yield.”

Due to this incident, the industry has matured and many simply ignore services that provide returns without disclosing the source. In fact, the Real Performance Story is what many believe is the natural next step for crypto investors that features dividend-like returns.

Simply put, protocols and services that provide returns to investors through profits generated from the trading platform or activities are a sustainable way to earn passive income.

Flynt CEO David Seo points out that “as a web3 player, one of the most vital actions we can take is to be radically transparent and communicate every step of the service” and that “Flynt is ready to display all the information we have regarding the services we provide because we have nothing to hide”.

Flynt explained that a 5x covered call strategy is available on Bitcoin, which offers a sustainable return of up to 40%.

They pointed out that Flynt is testing other assets and various structured strategies that can maximize returns for relatively less risk.

Flynt also mentioned that they pride themselves on only providing products that have historically made a profit rather than blindly focusing on expanding product lines.


All information contained on our website is published in good faith and for general information purposes only. Any action the reader takes on the information found on our website is strictly at their own risk.

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