How it works
Split writes fully collateralized options. Every position's maximum payout is locked in the contract before the position exists. There is no margin, so nothing is liquidated, for the buyer or the writer.
Two settlement modes
| Cash-settled | Physical | |
|---|---|---|
| Where | Robinhood Chain, BTC and ETH daily rounds | Base and Arbitrum ETH options (the original vaults) |
| Writer locks | The band width W, in USDG | One underlying token per call; the strike in stablecoin per put |
| Payout | Capped at W | Uncapped above the strike (calls) |
| Price feed at settlement | One Chainlink read | None. The holder exercises by paying the strike. |
| Exercise | None. Settle, then claim. | Exercise window at expiry; approved calls on Base are auto-exercised |
Current trading is on the cash-settled path. See What is live.
Cash-settled band
A band has a strike K and a cap K + W. Two ERC-20 legs:
Up (N) = min( max(S − K, 0), W )
Down (P) = W − UpThe pool locks W per contract when it sells either leg. Up and Down always sum to W, so the pool can never owe more than it holds. Details: Cash-settled spreads.
Physical vault
Depositing one underlying token mints a principal leg (P) and a call leg (N). N is the right to pay the strike and receive the token during the exercise window. P redeems for whatever the vault holds after settlement: unexercised tokens plus the strike paid by exercisers. One P plus one N recombine into one token at any time before settlement. Puts are the mirror, backed by the strike in stablecoin.