# Charm Options [Charm Options](https://options.charm.fi/) is a breakthrough [automated market-maker](https://academy.binance.com/en/articles/what-is-an-automated-market-maker-amm) (AMM) that can create liquid options on the blockchain. It works by splitting an asset into different options and creating a prediction market for them, so that they can be priced and traded. This results in options markets that are **cheaper, more liquid, and more scalable.** Charm Options is unique because: * Options are priced purely by supply and demand and don't rely on Black-Scholes or an approximation formula. This means price discovery can occur naturally and **options are cheaper**. * All option markets for a given underlying and expiry are [combined into a single pool](https://medium.com/charmfinance/charm-options-v0-2-f47c8b386bb0), which means trading activity in one market will benefit all the other markets. This means Charm's option markets can **support bigger trades and are therefore more liquid.** * A [single pool of options](https://medium.com/charmfinance/charm-options-v0-2-f47c8b386bb0) also means that liquidity is not fragmented across multiple markets. This means **more options markets can be provided for any given amount of liquidity.** In summary, Charm has invented a new type of [capital efficient ](https://app.gitbook.com/@charmfinance/s/charm-finance/~/drafts/-MW4JzBt_k4J-w9jRETd/charm-options/key-features/why-is-capital-efficiency-important/@merged)AMM that can provide a number of unique benefits. These benefits are described in the next page. --- # Agent Instructions: Querying This Documentation If you need additional information that is not directly available in this page, you can query the documentation dynamically by asking a question. Perform an HTTP GET request on the current page URL with the `ask` query parameter: ``` GET https://learn.charm.fi/charm/previous-products/charm-options.md?ask= ``` The question should be specific, self-contained, and written in natural language. The response will contain a direct answer to the question and relevant excerpts and sources from the documentation. Use this mechanism when the answer is not explicitly present in the current page, you need clarification or additional context, or you want to retrieve related documentation sections.