Premia Blue

Premia Blue (formally called Premia Finance) is a decentralized American options protocol that aims to create a permissionless fully collateralized marketplace that allows traders to purchase and exercise options at any time via an associated liquidity pool provided by retail investors.

To price the option positions, Premia constructed a mechanism to create market-driven prices by calculating the utilization of the liquidity pools and the ratio between supply and demand to create a fair market for both buyers and writers.

If you have a lack of knowledge in American options, this is a quick explanation:

American options, also known as standard options, are financial derivatives that give holders the right to buy or sell a certain underlying asset at a specified price on or before a predetermined date.

They differ from regular options in that they can be exercised at any time before the expiration date. This means that holder of an American option has more flexibility and control over their investments than those who hold regular options.

American options also have higher premiums than regular options due to their greater flexibility and potential for profit.