Here's a great explainer on MOVE contracts: youtu.be/IRU52DtWnFk
Huge thanks to and @NalexNuls for making it!
Conversation
Nice.
Who are the counter parties?
What if by fluke 1000 vs 1 people all said the market would move by $1000, who pays out?
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In the end if you hold it until expiration it'll pay out the amount the market actually did move, independent of the market prices of the MOVE contract.
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I understand the concept. It’s a great product.
Just wondering who owns the magic money tree that pays out, or if it’s a case that the majority will be wrong, so there are enough counter party losers to pay winners.
Otherwise it sounds like a legal ponzi. Props, just for that.
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FTX handles the margin; your counterparty risk isn't against the customers on the other side in particular.