#TermMax
TermMax's Alpha markets on BNB Chain were advertising around 200% APY on tokenized stock deposits. The tenor on those markets was three days.
Run the arithmetic before the number does its work on you.
200% annualized across a three day position is roughly 1.6% actual premium. That is what you collect for underwriting the option.
The AERO market on Base is cleaner to check. 35% APY as a call underwriter, maturity September 18, so about 36 days. That is roughly 3.4% for the period.
I am not saying the rates are misleading. Annualizing is standard. But annualizing a three day premium produces a headline that describes a return almost nobody actually holds long enough to earn.
Here is the part that matters more. TermMax's own glossary defines Dual Investment as the counterparty providing liquidity to long and short options, effectively the option seller. If you deposit, you are short an option. Your upside is capped at the premium. Your downside is assignment at the strike.
What the documentation does not specify anywhere I can find is who sets the strike, who prices the premium, and what price source settles at maturity.
@TermMax
My call for the next few weeks. At least one of these short tenor bStock markets settles in the money and hands depositors the asset instead of the premium, and the APY screenshots circulating now will not describe what those depositors actually got.
If you have deposited into an Alpha market, did you read it as yield or as writing an option?
TermMax's Alpha markets on BNB Chain were advertising around 200% APY on tokenized stock deposits. The tenor on those markets was three days.
Run the arithmetic before the number does its work on you.
200% annualized across a three day position is roughly 1.6% actual premium. That is what you collect for underwriting the option.
The AERO market on Base is cleaner to check. 35% APY as a call underwriter, maturity September 18, so about 36 days. That is roughly 3.4% for the period.
I am not saying the rates are misleading. Annualizing is standard. But annualizing a three day premium produces a headline that describes a return almost nobody actually holds long enough to earn.
Here is the part that matters more. TermMax's own glossary defines Dual Investment as the counterparty providing liquidity to long and short options, effectively the option seller. If you deposit, you are short an option. Your upside is capped at the premium. Your downside is assignment at the strike.
What the documentation does not specify anywhere I can find is who sets the strike, who prices the premium, and what price source settles at maturity.
@TermMax
My call for the next few weeks. At least one of these short tenor bStock markets settles in the money and hands depositors the asset instead of the premium, and the APY screenshots circulating now will not describe what those depositors actually got.
If you have deposited into an Alpha market, did you read it as yield or as writing an option?
