I was trading call options on the Deribit platform both on BTC and ETH cryptocurrencies. To make myself accountable I decided to run a 30-day experiment - trading 1DTE call options.
On Deribit platform I've been trading crypto options with various success since April 2019, unlike stock options, crypto options are cash-settled in crypto, which can make this bit complicated, make sure to read out my previous article on this topic;
- Selling Covered Calls on Ethereum (Crypto Cash Settled)
- Selling Covered Calls on Crypto (Ethereum / Bitcoin) with Deribit?
In March 2020, with stock markets collapsing, Bitcoin also collapsed, and many investors were calling Bitcoin a junk (including me) - my open positions on Deribit were facing liquidation buy and I lost some good money there (but as I have been making this good money in the past, I didn't cry much, let's say this - I was break-even)
Now I withdrew what was left, and for some 6 months forgot about the platform (and instead focused on the stock market).
At the end of November 2020, after a sudden Bitcoin rally, it was a hot potato once again in many Facebook investor groups. I decided to give one more try to the deribit trading platform and deposited some ETH and started 30-day call option challenge
On day 22 my funds were blown away totally. This is something I was actually expecting
Daily income from Trading 1DTE options on Deribit
With Bitcoin rallying for the first time above $20,000 my call OTM positions (which were established 24 hours before) were literally blown away. In total I lost more than $300 today.
My total investment was $632.72, and after today I was left with $499.05, now this is something impossible in the stock market when selling covered calls.
If I were not selling any calls today, my crypto value would be about $1,000, but what's important - I would keep all my coins.
I decided to stop this experiment now, withdrew all funds from the Deribit, and not looking to get back anytime soon - if, then only buying calls or puts (not selling), but better I will wait for a real Bitcoin ETF we can trade options with.