Introduction

In the DeFi derivatives sector, the ecosystem of on-chain perpetual contracts is rapidly developing, while on-chain options products lag. Compared to Dapps focused on trading and lending, on-chain options protocols hold a smaller cryptocurrency market share. However, with the introduction of the Bitcoin spot ETF, the mainstream adoption of the crypto market continues to rise, and the professionalization of crypto traders and market makers is gradually increasing. Options products, as essential derivative tools in traditional finance, have undeniable future potential.

Recently, as an innovator in decentralized finance, Jasper Vault announced at the Global Bitcoin Conference the launch of a peer-to-peer options trading product for native Bitcoin Layer 1 assets—Time-Locked Options. Additionally, Jasper Vault announced a Genesis Airdrop event of 100 million points starting on September 9. So, what exactly is Jasper Vault?

What is Jasper Vault?

Jasper Vault is a peer-to-peer interoperable options protocol designed to support 99% of options, making DeFi options intuitive, simple, and secure. The protocol innovatively applies account abstraction (AA) technology, program-derived addresses (PDA), and atomic swaps through hash time-locked contracts (HTLC) to facilitate peer-to-peer transactions and interoperability between different on-chain wallets. The main product of Jasper Vault is the 0DTE (Zero Days to Expiry) at-the-money options. Currently, Jasper Vault only allows the purchase of at-the-money options, with other types of products to be gradually opened based on platform development.

Jasper Vault offers three trading modes:

• Degen Options are 0DTE at-the-money European options for ETH and WBTC, providing an alternative for perpetual trading. 0DTE options refer to contracts that expire and settle automatically on the same day they are traded, meaning the expiration time is less than 24 hours.
• Swap Options are at-the-money American options settled in physical assets.
• Jasper Pro is designed for advanced traders who can buy and sell options peer-to-peer in this market.

Source: jaspervault.io

Core Technology

Account Abstraction (AA) Technology: By creating a special AA Vault for each user, Jasper Vault enables secure peer-to-peer transactions, eliminating counterparty risk.

Program-Derived Addresses (PDAs) and Atomic Swaps: These features support wallet interoperability across different chains, greatly enhancing their application scenarios within the DeFi ecosystem.

Jasper Vault SDK: This provides developers with a set of tools and libraries to simplify the integration process with the Jasper Vault platform.

Market Positioning and User Experience

Jasper Vault’s unique positioning in the market is reflected in the following aspects:

Zero Liquidation Risk: Offering up to 300x leverage while promising zero liquidation risk, it attracts investors seeking high returns with manageable risks.

Diverse Options Products: Including Degen Options (2-hour call and put options), 0DTE Options (zero days to expiration options), and Swap Options, catering to different risk preferences and investment strategies.

Integration of NFTs and Options: By launching the Fractal Jasper NFT series, Jasper Vault not only innovates in financial tools but also expands its brand influence in the NFT space.

Platform Advantages

For Options Buyers:

• Trade options using NO Scam Wick
• Engage in swap trading through physically settled options
• Trade options in an intuitive, beginner-friendly manner

For Options Sellers:

• Achieve a peer-to-peer model with no counterparty risk through Jasper Vault’s DeFi Options Vault (DOV)
• Earn additional options protocol fees by trading on Jasper Pro

Fee Structure

Jasper Vault charges a 10% protocol fee for Degen Options, 0DTE Options, and Swap Options. The fee is collected from the options buyer when paying the protocol fee. The protocol fee is calculated by adding 10% to the quoted premium amount, and the fee is directly deducted from this marked-up portion.

Introduction to Degen Option

Degen Option is an innovative development of Jasper Vault that allows users to open 2-hour at-the-money call and put options for ETH, dlcBTC, and WBTC with European settlement. It currently supports usage on Base, Bitlayer, and Arbitrum, with future plans for multi-chain integration.

Advantages

• Achieve high leverage (approximately 328x, depending on market volatility)
• More affordable than long-term options to attract smaller traders
• No liquidation risk from market fluctuations within the 2-hour opening period
• No restrictions based on time zones
• At-the-money options allow users to focus on market direction easily

Frequently Asked Questions

• Expiration and Settlement

All Degen Option positions are settled in a European style, automatically settling 2 hours after opening. All call positions are paid in spot assets (ETH or BTC), while put positions are paid in Tether (USDT). After automatic settlement, all profits can be viewed in the

Asset Tab under Vault.

• What is the maximum loss for users?

The maximum loss for users is the initial premium paid.

• Are Gas fees for Degen Options subsidized?

When opening a position in Degen Options, users must sign four transactions. The initial transaction approves the expenditure amount, while the subsequent three transactions are subsidized by Jasper Vault.

Source: jaspervault.io

Introduction to 0DTE Options

0DTE options refer to contracts that expire and automatically settle on the same day they are traded, meaning the expiration time is less than 24 hours. Building on this, Jasper Vault has introduced at-the-money options with strike prices always aligned with market prices, allowing investors to flexibly operate by simply assessing market uptrends and downtrends.

Advantages and Design

This design retains the advantage of high leverage while addressing the fixed delivery time issue of traditional options. Jasper Vault offers intraday options with 2, 4, 8, 12, 16, 20, and 24-hour durations to meet the needs of global investors. Investors can choose to settle within 2 to 24 hours after placing an order, allowing them to capitalize on market fluctuations. Another significant advantage of Jasper Vault’s 0DTE options is the guarantee of no liquidation during the selected time frame. If the price volatility exceeds the liquidation price after the chosen period ends, the premium will still be settled. Taking the 24-hour ETH option as an example, Jasper Vault’s 0DTE provides leverage of 94x. During this 24-hour period, regardless of market fluctuations, investors’ positions will not be prematurely closed, and their final returns will not be affected by intermediate volatility. Additionally, higher leverage allows investors to leverage a relatively small amount of capital to control a larger market value, thus achieving higher returns amidst market fluctuations.

High Leverage Characteristics

Jasper Vault’s 0DTE options feature unilateral high leverage, with leverage ratios reaching 328x. Unlike traditional contracts, there is no liquidation in extreme market conditions, ensuring investment safety. Jasper Vault has also introduced Degen options with a minimum investment of $2 to lower the entry barrier, allowing more investors to experience a financial tool that offers high returns, high leverage, and no liquidation risk.

Source: jaspervault.io

Introduction to Swap Options (not yet launched)

Swap Options is an innovative product from Jasper Vault that allows users to pay a small protocol fee in advance to lock in asset value over a specified period. This enables users to swap asset value at any desired price point within the designated time frame.

Advantages

• No restrictions based on time zones
• At-the-money options allow users to easily focus on market direction
• Physical delivery of underlying assets similar to swap trades
• No risk of position closure due to market fluctuations before the expiration

Frequently Asked Questions

• Expiration and Settlement

Swap Options positions are settled in an American style, meaning they can be settled at any time during the option’s term. After settlement, all profits can be viewed under the asset tab.

• How do Swap Options differ from Uniswap v2 from the perspective of option buyers?

Uniswap v2 only allows users to exchange assets at the current market price. In contrast, Swap Options enable users to lock in the value of the underlying asset within an 8-hour time frame, similar to purchasing at-the-money call or put options on the underlying asset. Swap options also give users the right to swap the asset at any time within this 8-hour window.

Development Plans

Jasper Vault plans to expand its Swap Options cryptocurrency pairs to include liquid staking/re-staking tokens such as stETH, fraxETH, and eETH, as well as BTC L2 tokens like mBTC and dlcBTC.

Introduction to Jasper Pro (not yet launched)

At Jasper, accurate and efficient pricing is a core element of cryptocurrency options trading. Unlike traditional decentralized exchanges, Jasper does not solely rely on internal smart contract-based pricing algorithms. Instead, the platform has developed a centralized pricing service integrating data from well-known sources like Deribit and CoinMarketCap. Using validated financial models such as the Black-Scholes algorithm, Jasper provides reliable protocol fee quotes for various assets across strike prices and time intervals. This hybrid pricing strategy effectively enhances pricing accuracy, ensuring users can trade with greater peace of mind.

Advantages

Jasper’s core philosophy is to combine reliability, security, and transparency. Through the efficiency of centralized data processing, we can accurately calculate option protocol fees while leveraging blockchain technology to ensure data integrity. Each quote generated by the centralized pricing service is signed in accordance with the EIP-712 standard, facilitating verification and authentication. This approach not only enhances security but also strengthens user trust, as each signed quote clearly indicates that the data has not been tampered with.

Trading Process

Jasper adopts a unique trading process that reflects its hybrid decentralized model:

• Price Retrieval: Users begin trading on the Jasper platform by viewing the latest option protocol fees obtained in real-time from a centralized pricing service. This process ensures that all potential trades are based on the most up-to-date and accurate financial data.
• Initiating Trade: When a user decides to purchase an option, they interact with Jasper’s DApp, which displays the necessary protocol fee information. If the buyer agrees to the quote, they can initiate the trade directly through the DApp.
• Order Processing: After the order is submitted, the centralized listening service receives it and is responsible for notifying the seller’s representative. This centralized component quickly verifies the signed price data included in the order.
• Trade Confirmation and Settlement: Once the price signature is verified, the seller agrees to the trade, and the transaction proceeds. The actual asset exchange is facilitated by a smart contract, completed entirely on-chain. This ensures the security and immutability of the final settlement.
• Post-Trade: If the buyer chooses not to exercise the option before expiration, the assets locked in the smart contract will be safely returned to the seller, thereby completing the trade without any unfulfilled obligations.

Introduction to HTLC Options (Beta Version)

Jasper Vault recently launched a peer-to-peer options trading product for native Bitcoin: Hash Time Locked Options (HTLC Options). This product utilizes hash time lock contracts and Taproot signature algorithms to enable options trading on the Bitcoin native chain while maintaining Bitcoin’s peer-to-peer payment characteristics.

Unlike the currently popular Bitcoin Layer 2 Wrapped Tokens or cross-chain bridge solutions, Jasper Vault’s Bitcoin DeFi approach allows options buyers to pay the option fee in USDT on EVM chains while the underlying asset remains Bitcoin. The settlement process still occurs on Bitcoin’s Layer 1, eliminating the need for cross-chain operations or conversion to wrapped tokens, thus ensuring Bitcoin’s security.

When using the HTLC Options protocol, users must hold both a Bitcoin wallet and an EVM wallet. Options are delivered in Bitcoin Layer 1’s UTXO accounts, while the option fee and strike price are paid through the abstract accounts of both parties on the Ethereum chain.

Advantages

• Inheriting the Bitcoin Ecosystem: Both parties conduct transactions on smart contract infrastructure without needing third-party intervention.
• Security: Bitcoin assets are locked in multi-signature addresses within UTXO accounts, and upon exercise, assets are transferred according to predefined logic, ensuring security.
• Cross-Chain Interoperability: Although Bitcoin is stored in UTXO accounts, payments can be made on other smart chains, supporting interoperability between EVM and Solana.

Fractal Jasper NFT

The Fractal Jasper NFT series includes 3,333 unique NFTs, each representing a distinct gem within Jasper Vault, and will debut on Fractal Bitcoin.

Interests Held in NFT

Holders of Fractal Jasper NFTs will enjoy a range of benefits that will increase over time, including:

• Principal preservation trading: Enjoy one risk-free trade of 0.01 WBTC on the platform.
• Double trading points: Trading points will permanently double before the Token Generation Event (TGE).
• Future airdrops: Holders will receive additional allocations in future Jasper Vault token airdrop events.
• Staking rewards: Staking NFTs grant eligibility for airdrops from other ecosystem projects.
• Additional benefits: Ongoing updates as the project develops.

Summary

With the rapid development of global financial markets, cryptocurrency options trading is gradually becoming a focal point for investors. With its high leverage, low cost, and high flexibility, Jasper Vault offers investors a new way to capture short-term market fluctuations. Jasper Vault embodies the true concept of Web3, allowing users to have complete control over their assets. Users can trade options without permission, and the platform’s design ensures that options settlements are completed without any counterparty risk. This seamless integration and security assurance make Jasper Vault a competitive player in the options trading platform space.