Hegic Protocol

Hegic is a peer-to-pool option trading protocol that allows users to trade in options in a decentralised way.

Hegic works quite simply with the participation of two components, writers and buyers:

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Hegic Protocol Overview

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In traditional finance, one of the most important pieces of derivative products can be mentioned is options.

A simple option is a contract that allows a holder to exercise a call or put option at a predetermined price in the future with the main purpose of minimising the risk (hedging) or speculation.

The simple structure of an option includes 8 components:

  • Premium: Cost for 1 Call / Put option.
  • Strike Price: The contract will be executed at this price.
  • Break-Even Price.
  • Writers: Seller’s options at the strike price.
  • Expiry Date: Time the option takes effect to exercise.
  • Settled: Profit is paid in what?
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