Why will retail and professionals love DBOE?

Demand side

• Directional (bullish) speculation

• Hedging (downside protection)

Pros

• Cheaper payout driven by price range speculation

• Flexibility to extend the speculation range simply by buying contiguous DBOE options

• No risk of Auto-Deleverage (ADL)

Cons

• Might require some education at first

• Multiple trades needed to replicate a regular option

Supply side

• Underlying holders sell to enhance yield

• PTGs can be market makers or liquidity providers

Pros

• Higher flexibility when risk is broken into smaller chunks

• Lower collateral required when compared to other DEXes

• Built-in hedge (no execution basis risk)

Cons

• Slightly more complicated to price

• Thin premium for far OTM options might be less appealing to sellers