SYNTHR Protocol

Synthetic Options Marketplace

SYNTHR's roadmap includes the creation of a highly liquid and efficient synthetic options marketplace. Currently, there are several DeFi option platforms; however, the existing solutions only offer European-style options on a very small number of assets (limited only to crypto assets) with limited expiration options.
Unlike most decentralized options trading platforms, SYNTHR will offer trade-only European-style options, which will allow users to mint and trade synthetic options and take price exposure to options without the risk of ever exercising them. A synthetic options contract that is non-exercisable and issued on a trade-only basis eliminates the need for an intrinsic options pricing engine and the requirement to build a capital-efficient options AMM capable enough to appropriately price volatility. Instead, SYNTHR will use price feeds from select options AMMs to price the options and allow its users to mint syOptions at the input prices by depositing collateral. Like SYNTHR’s Global Debt Pool for syAssets, a separate Global Debt Pool will be used for all syOptions minted by the protocol. Users minting syOptions will be issued Debt Pool Shares, representing their respective share of the overall Global Options Debt Pool. Replacing the AMM model with the Global Debt Pool model will make SYNTHR’s options marketplace capital-efficient and give users the freedom to use options as a hedging mechanism without exercise obligations.
In conclusion, the options marketplace on top of SYNTHR will allow more fee generation opportunities for the platform and lucrative hedging strategies and speculative directional strategies for traders.