> 1. Observe market parameters (volatility of the underlying and risk free rate) 2. Plug into formula 3. Deduce a price for the option.
In the FX market (interbank), the quoted and "traded" number is Implied Vol - the price of the option then follows from there (via the Black–Scholes model).
> I mean they literally stole another YC startup's work wholesale and effectively defrauded YC investors.
Didn't YC know it was a fork of one of their existing investments? If they knew then it is bad, if they didnt know then it is bad. If they didnt know and continue to fund this startup then they are stupid.
> The only reason a system like that can work is if participants act in good faith
If you are a professional investor you need a better bullshit detector. If you fail any time someone acts in bad faith, it is not the game for you.
The investment world is full of functional sociopaths. You get used to it I guess. YC's bullshit detector would be blaring nonstop if that was enough to tank a deal.
It's the software developer equivalent of - I will make a post on my Instagram (50,000 followers) if you give me a free holiday - "influencer" request.
> once there are not enough makers, the product and entire ecosystem dies
Once there are not enough makers, willing to license products to corporations for free, the corporations either have to write their own software or die.
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