Market Makers

Options are sold to Market Makers, who fill all the requirements of sound risk management practices that are validated by the community and with whom Dirac Finance signs an ISDA agreement.

The market makers that we will retain are those who continuously buy options, regardless of market conditions, and mitigate their risks through classical TradFi techniques such as delta hedging.

By doing so, we guarantee to generate yield to our LPs (Liquidity Providers) whether we are in a bear or bull market.

Market makers pay a premium when they buy an option and may lose it if this option expires out-of-the-money, meaning the price of wETH or wBTC is above the strike price of the concerned put option.