Options That Never Expire

Everlasting options are options contracts that never expire. Unlike traditional options with fixed expiration dates, these positions remain open indefinitely. The holder pays a continuous funding rate to keep the position active, replacing the time-value decay of conventional options.

The CLUM (Concentrated Liquidity Utility Maximizer) is an automated market maker that prices options using a discretized probability distribution. When you buy or sell an option, the CLUM determines the fair premium based on risk-neutral pricing. There is no counterparty matching — the LP pool acts as the other side of every trade.

Option holders pay a continuous funding rate that streams per-second from their funding balance to the LP pool. This funding represents the time value of the option (mark price minus intrinsic value). You must maintain a sufficient funding balance to keep your position active.

You can exercise your option at any time when it is in-the-money. Navigate to My Positions, select the position, and click Exercise. Settlement is calculated based on the current spot price and happens instantly on-chain. No approval is needed — just call exercise.

If your funding balance drops below the minimum required amount and a grace period expires, your position becomes liquidatable. Anyone can then liquidate it. You can top up your funding balance at any time to prevent liquidation.

LPs deposit USDC into the LP Pool (an ERC-4626 vault) and receive LP shares. The pool earns premiums when traders buy options and receives continuous funding payments. It loses money when traders exercise in-the-money options. Net returns = premiums + funding - losses.