Use Cases

The following are some typical uses cases for Charm Options:

A trader who wishes to perform Arbitrage trades for risk free profits.

Charm Options provides the largest selection of ETH and WBTC options within Defi, and the prices are determined entirely by the market. As such, there will always be opportunities for arbitrage trades between Charm and other platforms (eg Deribit).

See our article on arbitrage for examples of how to place arbitrage trades on Charm and Deribit.

An yield farmer who wishes to find different ways to get high yields.

Charm allows long and short positions to be placed. This means it is possible to sell an option to get high yields, if users believe the price of the underlying will not move too much.

In contrast to other yield farming platforms, users at Charm will know exactly what their risks are and their yields, as these will be explained in full before any purchase.

Our article on covered calls explains how to earn high yields at Charm.

A token holder who wishes to have more stake in innovative projects.

Charm's goal is to build an ecosystem of community owned innovations. In contrast to Ethereum, who have inspired similar ecosystems, Charm's intention is for Charm Tokens to be the single token that gives token holders governance rights to ALL of the innovations created by Charm.

A investor or trader who wishes to buy cheap options.

Given that Charm's prices are determined by the markets, there will always be opportunities to buy cheap options. Options that are up to 50% cheaper than Deribit (even after gas fees) are frequently seen at Charm.

An investor/trader with small amounts of capital, who want to build a large range of high quality assets.

Any size trades can be placed at Charm, regardless of whether users want to place a $1 trade or a $100k trade.

In fact, Charm works best for smaller trades due to lower slippage, and some of the best performing %1,000 ROI trades were from initial investments less than $300, so there are plenty of scope for smaller traders or investors to grow their portfolios.

In addition, options at Charm offer a combination of high leverage AND downside protection AND no liquidation risk. This means Charm options are the ideal instrument for small traders or investors who want to build diversified portfolios at lower risk.

A new investor or trader who wishes to learn more about investment and trading.

At its heart, Charm is a tool to help users learn how to invest and trade in a real life environment.

This is why Charm has designed a super simple options trading interface without the complications seen on other platforms; published education articles on how to earn yields and profits; and launching mainnet competitions to help users experience the realities of trading or investing in the real world.

A liquidity provider who lost a lot of money depositing large sums into liquidity pools.

Charm's capital efficiency means liquidity providers only need to deposit a small amount of liquidity, to generate the same yield as many liquidity pools elsewhere.

By depositing in small amounts, LPs can also free up more funds to make the most of other opportunities within DeFi.

As such, LPs should deposit smaller amounts of liquidity at Charm, compared to how much they usually deposit in other liquidity pools.

A liquidity provider whose assets are locked up in liquidity pools earning very low rate of returns.

Charm's capital efficiency means there are more scope for higher yields because much larger trade sizes are possible. This means LPs can earn higher trading fees for any given amount of deposits.

A builder of Defi products, who wish to integrate options as part of their offerings.

Charm Options is a primitive that offers the largest selection of options in DeFi, that are fully composable and easily understood from Etherscan. Therefore, anyone can use the large number of options offered by Charm to build their own super-cool DeFi products or services.