Trading on Zeta (Binary Options)

A how-to-trade guide for using Zeta's binary options interface

How trading on Zeta works

We’ve condensed what you need to know about our platform into a few bullet points.

  • 📈 OMM-based market: You will be buying and selling contracts against Zeta’s novel OMM solution, which provides live prices using an on-chain calculation. Contracts will also be marked to the fair price that the OMM computes for unrealised PnL calculation.

  • 🏦 Leveraged Trading: Zeta’s alpha launch will allow trading on up to 10x leverage on all of our contracts. A detailed explainer on how we maintain safe leverage sizes whilst preventing overbankruptcy is coming soon!

  • 🧩 Multiple strikes: 5 dynamically-generated strikes will be tradeable at any moment, allowing you to bet on favourable outcomes, coin flips and long shots.

  • ⏳ Hourly expiries: Options will be expired hourly, with one option series available at once.

  • ⚖Intuitive Payoffs: Our options expire to 0 if the price is below the strike, 1 if the price is above the strike, and 0.5 if the price is at the strike (with a confidence interval) at expiry.

The workflow

  1. Log into your preferred wallet and airdrop yourself some Solana tokens. Sollet has this functionality baked into their UI, otherwise you can also use SPL-token-ui to airdrop yourself some Solana. Make sure you are using devnet.

  2. Click the Start Trading button, this will mint you some USDF (fake USD) which you can use for trading.

  3. Initialize your options account and you’re ready to get going.

  4. Select the strike you want to trade, and click buy or sell, choose your leverage (if you want to), and put in quantity. Confirm your order at the bottom and your transaction will go through!

  5. Manage your positions and view your account risks here.

  6. Don’t forget to check out your profit against everyone else’s on our live Leaderboard!

Key Formulas

Mark prices: This is calculated via the Zeta AMM pricing engine, and will be updated continuously.

Position value: This is the sum of the current position values in the account. For long positions, the mark price is used. For short positions (1 - mark price) is used.

Zeta's safety margin: The difference between Zeta's mark price and the bid price (if long) or the ask price (if short). E.g. for a 26.7 strike call with bid price 0.18 and mark price 0.19 the safety margin for a long position will be (0.19 - 0.18) * qty.

Liquidation premium: A buffer that is kept in place to ensure liquidations don't cause overbankruptcy. This premium is currently kept at 5% of the total position value.