Options Greeks On-Chain

What Options Are

An option is a contract giving the holder the right (but not obligation) to buy (call) or sell (put) an asset at a specific price (strike) by a specific date (expiry). The price you pay for this right is the premium. Options let you express more nuanced views than just 'I think the price goes up' — you can bet on volatility, hedge specific risks, or generate income via covered calls. On-chain options have grown from a niche to a real market with protocols like Lyra, Aevo, Premia, and Deribit (though Deribit is centralised, it dominates crypto options by volume).

The Greeks in Plain English

Greeks measure how the option's price responds to changes in market conditions. **Delta**: how much the option's value changes when the underlying moves $1 (calls have positive delta, puts negative). **Gamma**: how fast delta changes — high gamma means small price moves swing your P&L dramatically. **Vega**: sensitivity to implied volatility — bought options gain from rising volatility. **Theta**: how much value the option loses per day as expiry approaches — the cost of holding the option. Understanding these is what separates 'I bought a call and don't know why it's bleeding value' from informed positioning.

Where On-Chain Options Live

Several production on-chain options protocols. **Lyra** (Optimism, Arbitrum) uses an AMM model with dynamic delta hedging. **Aevo** (own L2) uses an orderbook similar to Deribit. **Premia** (multiple chains) offers concentrated liquidity for options. **Hegic** offers simpler perpetual-style options. Each makes different tradeoffs in capital efficiency, UX, and supported markets. None has yet displaced Deribit as the dominant venue by volume, but on-chain options have grown substantially through 2024-2025.

• Options give the right (not obligation) to buy/sell at a strike by expiry
• Greeks: delta (price sensitivity), gamma (delta sensitivity), vega (vol sensitivity), theta (time decay)
• On-chain options: Lyra (AMM), Aevo (orderbook), Premia (concentrated liquidity), Hegic (simpler)
• Deribit (centralised) still dominates by volume; on-chain is growing but smaller