๐ The Rasgulla Story
Let's Start with a Sweet Shop!
Imagine your favourite rasgulla shop in India. One rasgulla = 1 Bitcoin. Everything makes sense from here!
The Famous Rasgulla Shop
Imagine Bitcoin is the most precious mishti rasgulla in all of India.
Today, one Bitcoin costs $60,000.
You believe the price will jump to $90,000 next month during Durga Puja!
Should you buy now? What if you don't have all the money? What if the price falls after the festival? That's exactly why Futures and Options were invented!
Should you buy now? What if you don't have all the money? What if the price falls after the festival? That's exactly why Futures and Options were invented!
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Why Do Traders Use These?
Bitcoin's price can swing +60% or โ80% in just a few months โ
wilder than rasgulla prices during a sugar shortage!
Futures lock in a safe price today so you're not shocked later. Options give you the choice to walk away if things go bad. Together they are the safety nets of crypto trading. ๐ก๏ธ
Futures lock in a safe price today so you're not shocked later. Options give you the choice to walk away if things go bad. Together they are the safety nets of crypto trading. ๐ก๏ธ
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Futures = A Pinky Promise with the Shopkeeper
You visit the rasgulla shop and shake hands:
"Dada, main 0.002 Bitcoin ke rasgullas โน5,50,000 mein lunga โ exactly 2 months baad!"
That's a Futures contract. BOTH of you MUST complete the deal โ whether the price goes up, down, or sideways!
"Dada, main 0.002 Bitcoin ke rasgullas โน5,50,000 mein lunga โ exactly 2 months baad!"
That's a Futures contract. BOTH of you MUST complete the deal โ whether the price goes up, down, or sideways!
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Options = A Lucky Durga Puja Coupon
You pay โน10,000 for a special coupon from the shop:
"I MIGHT buy rasgullas at today's price โ but only if I feel like it!"
Price goes up โ Use the coupon and save big! Price drops โ Throw the coupon away! Maximum loss = โน10,000 only. Sweet deal! ๐ฌ
"I MIGHT buy rasgullas at today's price โ but only if I feel like it!"
Price goes up โ Use the coupon and save big! Price drops โ Throw the coupon away! Maximum loss = โน10,000 only. Sweet deal! ๐ฌ
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Fun Indian Fact! In 2010, a programmer paid
10,000 Bitcoin for 2 pizzas. Imagine if he had sold rasgullas from a India shop instead and used a Futures contract to lock in the price!
Today that Bitcoin is worth $600+ Million โ enough to buy every rasgulla in India
for the next 100 years! ๐ฑ๐ฎ