Encyclopedia DeFi · Entry 346
Crypto calls and puts: a right, a premium and a payoff
In this article
At a glance
Key facts
Separate payoff from profit
Imagine a one-unit, quote-currency-settled call with strike 100 and premium 8. At expiry with a settlement price of 120, gross payoff is 20 and profit before fees is 12. At 105, gross payoff is 5 but the buyer loses 3 after the premium.
For a put with strike 100, a settlement price of 80 gives a gross payoff of 20. These simplified linear examples are not the settlement calculation for every crypto option.
Buying and writing have different obligations
A buyer can lose the premium if the option expires worthless. A seller receiving that premium has taken an obligation whose loss can exceed the premium, with collateral and liquidation rules set by the venue. Selling an already-owned option to close is different from writing a new short option.
Read the specification before the ticker
Check underlying, multiplier, strike, expiry, exercise style and settlement currency. Deribit’s cited inverse options are European and settle economically in BTC or ETH; a familiar call/put name does not make the contract physically deliver spot tokens to a wallet.
Direct answers
Questions people ask
Does in-the-money mean my purchase was profitable?
No. The payoff must also cover the premium and applicable costs.
Inspect the evidence
The answer and key facts have stable claim links. These records retain the scope and qualification when reused.
A call gives its buyer a contractual right tied to buying the underlying at a strike price; a put gives a right tied to selling. The buyer pays a premium, while the seller assumes the corresponding obligation. Crypto options can settle a cash-equivalent payoff instead of transferring the underlying, so exercise style and settlement specifications matter.
Scope: DeFi · data through 2026-10-02. Verification: verified · 2026-10-02T19:18:00.092Z.
Link to this claimCall: A call’s expiry payoff benefits from prices above its strike.
Scope: DeFi · data through 2026-10-02. Verification: verified · 2026-10-02T19:18:00.092Z.
Link to this claimPut: A put’s expiry payoff benefits from prices below its strike.
Scope: DeFi · data through 2026-10-02. Verification: verified · 2026-10-02T19:18:00.092Z.
Link to this claimExpiry: European-style options exercise only at expiry.
Scope: DeFi · data through 2026-10-02. Verification: verified · 2026-10-02T19:18:00.092Z.
Link to this claimRevision history
- — First publication after primary-source research and separate automated verification.
Source register
Sources and references
Retrieval dates and locators are recorded individually.- What is an Option?Options Industry Council
General option concepts; equity delivery conventions are not imported into crypto contracts.
Locator: Calls; Puts; Premium · Version / scope: Documentation retrieved for the 2026-10-02 editorial scope; content hash recorded · Retrieved: 2026-10-02T18:53:21.136ZOpen source - Inverse OptionsDeribit
Official support article retrieved through its public Help Center API; inverse settlement specifications.
Locator: Settlement process change; Settlement examples · Version / scope: Documentation retrieved for the 2026-10-02 editorial scope; content hash recorded · Retrieved: 2026-10-02T18:53:21.588ZOpen source
Research and drafting use AI assistance. A separate automated review checks claims against primary sources; no external expert or named human review is implied. Publication, substantive editing, source retrieval and verification are recorded separately. This version was independently checked by an automated reviewer on 2 October 2026.
Editorial method and correctionsDegrees of Satoshi editorial project. “Crypto calls and puts: a right, a premium and a payoff.” Published 2026-10-02; updated 2026-10-02. https://degreesofsatoshi.com/encyclopedia/crypto-call-put-options/