Introducing Thetanut’s Degen Vaults

Thetanuts Finance
4 min readJan 4, 2023


Bear markets are for BUIDLing. At Thetanuts Finance, our new Degen Vaults will be sure to whet your appetite for tantalizing yields. Borrowing the principles of legacy finance, we are using the power of leverage to create capital-efficient strategies that utilize Option Spreads and Iron Condor

Why Degen Vaults are for you

Firstly, Degen Vaults allow users with higher risk appetites to take on directional as well as opportunistic bets on the market and earn higher returns through advanced strategies such as option spreads and flat iron condor

Our initial offering will comprise three different ETH strategies:

Wow, yes, big yields and fancy words, but how and what do they mean?

Users of Thetanut’s Degen Vaults would only need to post collateral which is leveraged to collateralize the range between the options spread(s). This promotes capital efficiency as users can implicitly choose their leverage by depositing part, or all their assets into the vault.

In other words, depositing more capital into a Degen Vault is similar to increasing your leverage. You will get a higher, but fixed yield, however, you stand to incur some losses or all your capital if the underlying asset’s spot price moves closer to the sold strike price(s) depending on which Degen Vault you have selected (depending on which Degen Vault you select).

But if your prediction on the market’s direction is correct, the returns achieved can be far higher than what can be obtained from the vanilla-covered call and put-selling strategies.

What are Options Spread and Flat Iron Condor?

Options spread is a strategy in which options contracts with the same underlying asset are bought and sold to make a profit from the difference in the price of the options. This strategy combines different options positions, such as buying call options and selling put options, to create a position with a particular risk and potential reward profile.

On the other hand, a flat iron condor strategy involves combining a bear put spread and a bull call spread to create a position with limited risk and limited potential profit. The name comes from the shape it creates on a P&L diagram which looks like a condor.

Executing these strategies in practice involves a lot of work. However, our Degen Vaults have been designed to deliver these tedious strategies seamlessly; all you need to do is deposit (aka take on a directional bet!) your desired capital and let us do the magic for you!

How do I start using Degen vaults?

Head over to Degen Vault and check out our Bull Put Spread, Bear Call Spread and Flat Iron Condor strategies.

Refer to the following brief summaries of our Degen Vault products:

Bull Put Spread

The Bull Put Spread is ideal for users who are short-term bullish on the underlying asset. This strategy involves a combination of short put (higher strike price) and long put (lower strike price) with the same expiry date.

Bear Call Spread

The Bear Call Spread is ideal for users who are short-term bearish on the underlying asset. This strategy involves a combination of short call (lower strike price) and long call (higher strike price) with the same expiry date.

Flat Iron Condor

The Flat Iron Condor is ideal for users who are short-term neutral or slightly bullish on the underlying asset. This strategy involves a combination of a bull put spread and bear call spread with the same expiry date.

Risks involved

The main risk of using the Degen Vault(s) is that the user would start to lose part of their deposited collateral once the spot price of the underlying asset crosses the strike price of the short side of the options.

The maximum loss scenario is when the underlying asset’s spot price approaches the strike price of the long call/put option. The long call/put option is exercised and the max loss is capped to the user’s deposited collateral while still earning the options premiums from utilizing the strategy.

The Degen vault(s) were not designed as a “set and forget” yield-generating strategy. Users are recommended to form their own market views before making any directional bets using our Degen vault(s).

As such we recommend users to read the Degen Vault in our docs for a more detailed overview or contact us on Thetanuts Discord to clarify any concerns.

Our next steps

We look forward to launching more assets for our Degen Vaults in early 2023. If you have a particular asset in mind, do drop by our discord to share your suggestions. We welcome all proposals and feedback too!

We are always pushing the boundaries for structured products in crypto. Please do not hesitate to reach out if you have any questions for us and ensure that users are aware of the risk/reward involved in using structured option products.



Thetanuts Finance

Thetanuts Finance is building a decentralised on-chain options protocol focused on altcoin options 🥜❓