Clearing V1

Option Bond

The option bond is the refundable collateral a writer locks at mint. The core sizes it to a floor, the Black-Scholes value of the option at a conservative volatility from the ticker's smile, and holds it for the life of the short. It is a bond, not a fee: refunded in full on a clean exit, and put to work only if the cover is force-closed.

The floor

At mint the writer must lock at least the floor:

floor = BlackScholes(mark, strike, tenor, IV) × size
        (IV from the ticker's SVI smile, read at the strike and the mark)

The mark is HyperCore's live oracle price; the IV comes from the ticker's SVI smile, and the whole thing is priced through Black-Scholes on-chain. This is the fourth gate of a mint (see Writing Options): post less than the floor and the mint reverts. It is set once, at mint, a floor, not a running margin call.

Conservative on purpose

The floor uses a deliberately high volatility, not the fair-market one. A 30-day ETH option priced at a conservative 100% IV locks roughly 11 to 12% of notional, which is more than the writer collected selling it at a fair ~50% IV, and far less than the 100% a fully cash-collateralized option would demand.

The reason to over-fund: resolution happens later than the mint, and a crash spikes volatility, so a force-closed option can cost more to close than its mint-fair value. The high floor IV buffers that. It is a knob: a higher floor is safer but locks more of the writer's capital, so governance calibrates it per asset, between the safety it wants and the writers it wants to attract.

A bond, not a fee

The premium a writer sells the option for trades externally, wherever the market is; the option bond is separate collateral the core holds. On a clean exit, closing the position before any force-close, the bond refunds in full. It is consumed only if the writer is force-closed, in which case it funds the resolution.

So over-collateralizing with a high IV is refundable skin in the game, not a cost. The writer's real expense is the opportunity cost of the locked capital, plus the risk of forfeiting some of it if they go passive into a liquidation. Manage the position and you are made whole; ignore it into a force-close and the bond goes to work.

A finder fee is reserved on top of the floor at mint. It refunds with the bond on a clean exit and is paid to whoever opens the resolution only if a force-close actually happens, so the full floor always stays available to recollateralize the short. See Keepers.

Set by governance, not fed

The volatility behind the floor is a governance-set risk parameter per ticker, the way a lending market sets a conservative loan-to-value per asset, not a live volatility feed the protocol depends on. There is no external IV source to stall or be manipulated, and nothing fails closed, so any asset is listable once governance sets a sane smile for it. Listing a ticker is the governed action; writing on it, trading, and resolving are open to anyone.

After a force-close: the excess

If a cover is force-closed, the bond funds the recollateralization auction. Whatever the auction does not spend is excess, split by a governed lever among the DAO, the force-closed writer, and the insurance pool. And if an extreme move leaves the option worth more than the whole budget, insurance is the last-resort bidder that steps in at the ceiling to take it on.

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