Overview
Digital Asset Options is an interface for trading cash-settled calls and puts on eligible tokenized equities using Solana accounts and USDC settlement. The product separates account access, wallet custody, market discovery, order construction, transaction approval, and settlement.
The interface never needs a seed phrase. Wallet approval should happen only inside the wallet application selected by the user.
Core sequence
ACCOUNT → WALLET → ELIGIBLE MARKET → OPTION PARAMETERS → REVIEW → APPROVAL → SETTLEMENT
Account access
Markets are protected behind an account gate. Account identity and wallet custody are intentionally separate: an account grants product access, while a wallet provides a public Solana address and signs transactions.
Access controls
- Enforce authentication on the server, not only in interface controls.
- Protect account-specific endpoints and saved positions.
- Require age and risk acknowledgements where applicable.
- Apply jurisdiction, eligibility, and sanctions controls before market access.
Wallet connections
The interface detects compatible injected providers such as Phantom, Solflare, and Backpack. A connection request should return a public key. Viewing the public key does not authorize transfers or trades.
connect() → publicKey
review transaction → wallet prompt
sign → broadcast through configured RPC
Safety rules
- Never request or store seed phrases or private keys.
- Show human-readable transaction intent before wallet approval.
- Display the selected network and expected settlement asset.
- Reject unexpected program IDs, token mints, or instruction changes.
Option mechanics
Calls
A call produces intrinsic value when the settlement price is above the strike. For a cash-settled call, the payout is based on the positive difference between those values, adjusted for contract size.
call payout = max(settlement price − strike, 0) × contract size
Puts
A put produces intrinsic value when the settlement price is below the strike.
put payout = max(strike − settlement price, 0) × contract size
The buyer's initial outlay is the premium plus disclosed fees. Maximum loss for a fully paid option buyer is limited to that outlay.
Pricing
An option quote depends on the underlying reference price, strike, time to expiration, expected volatility, rates, liquidity, and inventory. Quotes should be presented only when returned by an identified pricing service or executable onchain market.
Required quote fields
- Premium and settlement currency
- Bid, ask, or firm executable price
- Strike and exact expiration timestamp
- Contract multiplier and exercise style
- Fees, slippage tolerance, and quote expiry
Collateral
A fully collateralized design reserves enough assets to meet the maximum writer obligation. Collateral accounting must be enforced by program logic rather than interface assumptions.
Vault controls
- Accept only configured settlement mints.
- Track reserved and available collateral separately.
- Prevent withdrawals that would leave obligations uncovered.
- Expose verifiable balances and position liabilities.
Settlement
European-style contracts settle at a defined expiration rather than through early exercise. A settlement service supplies the final reference value according to the market specification, and the program calculates payouts in USDC.
Market specification
- Underlying token and accepted mint
- Reference source and observation window
- Expiration timestamp and settlement delay
- Disruption, stale-price, and fallback rules
- Payout precision and rounding behavior
Market data
Prices, volume, open interest, implied volatility, balances, and returns must come from configured sources. The interface should show source identity, freshness, and error states and should never substitute generated values when a service is unavailable.
No value is better than a fabricated value. Missing information should remain unavailable until a source responds.
Risk controls
Options can expire worthless. Tokenized equities add issuer, custody, market-hours, tracking, liquidity, oracle, smart-contract, and regulatory risks.
Interface controls
- Show maximum loss and payoff before approval.
- Warn when quotes are stale or liquidity is insufficient.
- Require explicit review for material slippage or changed instructions.
- Separate informational estimates from executable quotes.
- Provide clear settlement and market-disruption documentation.
Operational controls
- Independent smart-contract audits and controlled upgrades
- Position, market, and vault limits
- Oracle freshness checks and circuit breakers
- Incident response and transparent status communication