CryptoSlate
Binance's Oct. 15 expansion lets eligible stock-options customers sell covered calls and cash-secured puts, collecting premiums while accepting share-delivery or share-purchase obligations. Put sellers must reserve enough USDC to buy every covered share at the strike price, with premiums held separately. The funds become unavailable for other orders or withdrawals when the sell order is placed.
Why it matters
A cash-secured put seller earns a premium in exchange for agreeing to buy the underlying shares if assigned. If the stock falls below the strike, the premium offsets only part of the loss. Binance's FAQ also allows early assignment overnight, leaving sellers unable to control when a buyer exercises. Written positions are not automatically closed at expiry, unlike eligible long options subject to best-efforts closure.
The offering also carries jurisdictional limits. Linked September terms exclude US persons, people located in the US, and accounts they beneficially own or control, while flagging possible restrictions in China, Hong Kong, the European Union, and other prohibited jurisdictions. Nest Trading Limited routes orders to Alpaca Securities LLC, which handles execution, clearing, settlement, and custody.
Market impact
The most important issue is the gap between Binance's new seller instructions and its published terms. The Stock Options Trading Product Terms remain version 1.0, effective Sept. 1, and Section 6.2 permits opening long calls and puts and closing those positions while expressly excluding writing and short positions. An older FAQ, updated Oct. 9, also describes long-only trading.
The FAQ says premiums and share settlement after assignment follow T+1 settlement, while USDC reserves remain locked until an order is canceled, expires unfilled, or the position is otherwise resolved. Until Binance updates the governing terms, sellers face uncertainty over which rules control their obligations.
Frequently asked questions
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How much USDC must Binance put sellers reserve?
They must hold enough USDC to pay the strike price for every share covered by their contracts. The reserve is separate from the premium.
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Can Binance stock-options sellers be assigned early?
Yes. Binance's seller FAQ says early assignment can happen overnight, and sellers cannot control the buyer's decision to exercise.
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What happens to the USDC reserve after a sell order is placed?
The funds cannot support other orders or withdrawals. They are released if the order is canceled or expires unfilled.
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Why do Binance's stock-options documents conflict?
The new FAQ describes covered-call and cash-secured-put selling, while the linked September terms still exclude writing and short positions. An older FAQ also describes long-only trading.
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Which jurisdictions are excluded from Binance's stock-options offering?
The linked terms exclude US persons, people located in the US, and accounts they beneficially own or control. They also flag possible restrictions in China, Hong Kong, the European Union, and other prohibited jurisdictions.
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