 Did you know that you can make daily, weekly, and monthly passive income selling Bitcoin and Ethereum options? I literally just made $3255 this week in passive income by selling options. And my favorite part about selling options is that the downside is very small when done correctly. I was surprised when I searched for crypto options and saw that nobody in the crypto world is talking about it. Yeah, if you look it up for traditional finance, you will see thousands of videos covering it. Not only that, but major public companies with billions of dollars of assets under management use these exact same strategies that I am going to teach you today. And now we all know that everything is bigger in crypto when it comes to returns. So bring out your pen and pad and get ready to dive into the little known world of selling Bitcoin and Ethereum options for passive income. What's up guys, my name is Jay and welcome to Bitcoin Daily. In today's video, I will be teaching you about the world of crypto options. I will be breaking down exactly what it is, how it works, why it works, and exactly how much money I made this week selling options. By the end of this video, you will quit your job, stop trading, and begin selling options for a living. All I ask for in return is that you smash that like button, subscribe to the channel, and leave a comment. So you're probably thinking, what in the world are options? Or maybe you've read about it before, but it seemed too complicated or risky. So let's go over the basics really quick for those of you who are new to options. In simple terms, an option is a contract giving the buyer the right, but not the obligation to buy or sell an underlying asset at a set price within a specific timeframe. So for example, imagine you want to buy Bitcoin, which is currently at $37,000. You believe that the price will go up in the next three months. However, you don't have the money to buy a full Bitcoin right now. So your friend who's the hell of a guy and who also has a full Bitcoin gives you an option because he's just such a good friend. He says that he will sell you the full Bitcoin at today's price. Any time within the next three months, all you have to do is pay a small fee in order to get this deal. Fast forward two months, let's say the price of Bitcoin went to $42,000. Because you paid that fee for that deal, you can still buy your full Bitcoin at the original price of $37,000, even though it's now worth $42,000 in a market. If you decide to buy it, you're getting the Bitcoin for $5,000 less than the current market price. So if you decide to sell it at the current market price, you make the $5,000 profit minus the fee that you paid for the option. This is how options work in trading. You pay for the possibility to buy or sell at a set price within a specific timeframe, hoping that the market moves in the direction favorable to you. This fee that we spoke about is called a premium and it's how we make income. But we will come back to that in just a few. Now there are two types of options, calls and puts. Think of it like this, when you're bullish on the market, you might go for a call believing that the price will rise. On the flip side, if you're bearish, you might opt for a put, expecting the price to drop. So with a call, you make money if the price goes up, with a put, you make money if the price goes down. Simple enough, right? So hopefully now you have a better grasp on what an option is and the difference between a call option and a put option. So now we know the basics. We need to understand what the difference is between buying and selling an option contract. This is where we make our money. When you buy an option, whether it's a call or a put, you're paying a premium for the right to buy or sell an asset at a certain price. So your risk is limited to the premium that you pay and your potential profit can be significant if the market moves in your favor. However, you need to be exactly right on the direction you think the market's going to go or you lose. Now on the flip side, when you sell an option, you're the one collecting the premium. In essence, you're granting someone else the right to buy or sell an asset at a predetermined price. However, here, you don't need to be exactly right in the direction. You just need to be far enough away from the price so that it never gets to you. And you always collect a premium regardless of the direction. So how does selling options make passive income? When you sell an option, you receive the premium upfront. As long as the market conditions stay in your favor, you keep this premium as your income. So let's take Bitcoin, for example. Let's say you own Bitcoin and you sell a call option with a strike price slightly higher than the current market value. So here's a strike. Here's expiration date. You can see the current value of Bitcoin is around $37,127. So let's go down to $37,250. And we're going to go towards bid. What bid means, that's the premium that you're able to collect for each option contract that you take. So if the price of Bitcoin stays below the strike price by the time this contract expires, which is in 14 hours and 23 minutes, you receive this premium. Doesn't matter if Bitcoin went up or down, as long as it stayed below your strike price, you made the income. So let's take a look at another example. Let's say we go out to December 1st, which is Friday. You can see here, it's three days and 14 hours away. And with Bitcoin currently sitting at $37,000, in the next three days, I really don't think that Bitcoin is going to go to $40,000. So if I come over here to the bid, I can see that I can make $75 per contract by Friday, as long as Bitcoin doesn't reach $40,000. If you click it over here, go to sell, because remember we're selling, not buying. One contract at $85, as long as the price of Bitcoin stays below $40,000, you will make the $85. So it doesn't matter if it goes down. It doesn't matter if it goes up. As long as it stays below $40,000, you make the $85 by Friday. So by looking for contracts that are far out of the money, where chances of Bitcoin reaching that price by that time frame are very, very small is how you make the passive income. Because you just keep doing it over and over and over and collecting the fees. Now, as good as this strategy is, of course, there's always a downside. So let's talk about it. First, let's talk about buying options. When you buy an option, your risk is limited to the premium that you pay. So if the market doesn't move in your favor, the most you can lose is the premium you pay. It's a defined risk and you know it upfront. That's why a lot of people like to trade options. Now, selling options, however, carries a different level of risk, especially if you don't know what you're doing. When you sell a call option, for example, if you let the contract expire and Bitcoin has gone beyond the strike price, you will be obligated to sell the asset at that strike price to the buyer. So if the market soars beyond your strike price, your potential loss could be significant. For example, looking at the same trade with a strike price of $40,000 and the expiration date of December 1st, you can see here as long as Bitcoin stays at $40,000 or below, by Friday, you make $85. Don't look at the day zero PNL too much. That really doesn't matter. And then look, as you go down, it doesn't matter where Bitcoin goes. As long as it's below $40,000, you will make the $85, right? Now, if it were to go beyond $40,000, look what starts happening at day four PNL. Let's say it went to $42,000. Now you're down $1,915. So that's basically the difference between the strike price and the current price minus the fee that was paid to you, right? Minus the premium. So if your strike price was at $40,000 and Bitcoin went to $42,000, take $85 away from it because that's the premium that you were paid. And now you have the promise to sell Bitcoin at $40,000. So that's what that loss is, that difference between $40,000 to $42,000 minus the fee. So as you can see, you can get substantial losses. And if these risks have spooked you in any way, good. I wanted to make sure they did because if you guys do not know what you're doing and if you don't manage your positions correctly, you can sustain substantial losses. However, it is possible to mitigate your risk when selling options with a very specific strategy that can almost always keep you from losing. This is known as rolling the option. This strategy can be a game changer when selling options. I'll do another video in the future breaking the strategy down, but let's quickly go over the idea of how the strategy works. Rolling an option essentially means that you're closing your current option position and simultaneously opening up a new option position, often with a different strike price and expiration date. This move is typically made when the current market situation begins to go against your trade. So for instance, if we sold this $40,000 call with the expiration of Friday and the price of Bitcoin started to get to $40,000, maybe it was at $40,200 to avoid potential loss or being obligated to sell your Bitcoin below market value, you can roll this option. By rolling, you buy back the original call option and sell another call option with a higher strike price or later expiration. This move can give Bitcoin more time to grow without affecting your position and it could also earn you additional premium increasing your potential income. Let's take a look at an example. Let's say on day four, the day of the option expiration date, Bitcoin hits $40,200. That would mean you're currently down $115 if you have one full contract. It's a $200 difference minus the $85 in premium you were paid. Now what we would do here is close this order for the $115 loss, but then go back a week to the 8th of December, for example, go to a further strike price. So let's say $42,000. And if we take a look at what the premium is paying, you will see that it covers the $115 loss. Currently paying $145, so you would make a $30 profit there. And let's say the 8th of December comes around and the price of Bitcoin is at $42,000 or getting even higher, you can roll it back once again. Let's say it'll $44,000. You just have to make sure that the premium that you're getting paid covers the loss on that contract. So maybe at $44,000, maybe $170 is not enough. Maybe you need $200 in order to cover your loss. So what do you do? You roll back further. Let's say the 29th of December, notice that the strike price of $44,000 here is paying out $500 in premium. So although you might need to wait a little bit longer, as long as you continue to roll back your contracts, you will offset any losses. So while rolling contracts can help manage risk, it's not a one size fits all solution. You need to carefully analyze market trends and understand your own risk tolerance. Sometimes just accepting a small loss on the original option contract could be more prudent than rolling the option into a new position with potentially higher risk. Remember that the goal of rolling options is not just to avoid losses, but to continue to strategically position yourself in an ever changing market. It's about making calculated decisions to both protect your investment and generate income. So by now you should understand exactly what options are, what cause and inputs are, the difference between buying and selling an option, how to sell options for passive income, and how mitigate risk by rolling your option. So let's see what this looks like in real time and take a look at some of the option contract that I sold over the past week and how much it made me. But first off, I'm an experienced trader with over 10 years in the markets. And I do this for a living, so I'm very, very active with my options. I jump in and out of them constantly as premiums change to maximize profits. Last week I sold 11 options. This made me a total profit of $3,255.12, which was a profit of about 13%. You see that my win rate was 100%. I didn't have any losers and my average contract returned about 3% on the risk. You can see here all the options I've been selling, both Bitcoin and Ethereum, both cause and puts, the contract sizes, entry price, strike, expiration, the premium that each pays me, the margin that it costs me, the date that I close them, the fees that I pay, premium debit, the return on risk, the annualized return, how many days I hold them for, profit loss and profit loss percentage. I like to have weekly options and monthly option contracts as well. For the most part, the further away the expiration date is, the safer it is. So weekly options are always going to carry more risk than monthly options. I also like to play options that are about one or two days away sometimes for some quick profits when there's a lot of volatility in the market because the premiums go up. Higher premiums mean more money. So although I didn't lose any trades, I did have a few close calls playing with the shorter days to expiration. So if you're a beginner, I definitely don't recommend those. If you're curious about the exact options I'm selling and want a closer look at my trading strategies, I invite you to join my private discord group. It's a subscription based community where I share detailed insights, real-time trade updates and personalized advice. Inside the group, you'll get the opportunity to see the trades I'm making, understand my decision-making process and learn advanced tactics that aren't covered here. It's a fantastic way to connect, grow and learn with other like-minded traders. Plus, as a member, you'll have direct access to ask me questions and get feedback on your own trading ideas. It's more than just a group. It's a community of traders committed to success. To join, simply click the link in the description below. Spaces are limited to ensure a quality experience for the members in the group. If you guys want to learn more about making passive income, selling Bitcoin and Ethereum options, I will be doing an entire series on it. So don't forget to subscribe to the channel, click the video on the screen right now. I'll see you guys there.