How do Covered Calls work?

A covered call is a simple and powerful tool at your disposal.

• You own a crypto asset like HYPE or WBTC

• You sell a call option: the right (although, not an obligation) for someone else to buy your asset at a chosen price (strike) in the future.

• For selling that right, you earn an upfront premium (yield), regardless of the option being exercised or not.

• If the asset stays below the strike price, you keep both the premium and your asset

• If the price rises above the strike price, your asset is sold at the strike price but you still keep the premium as extra profit.

---

Example: Selling a Covered Call with a $100 Strike Price

Scenario	Price at Expiry	What Happens	What You Earn
Below Strike price	$95	Keep asset + premium	Premium
At the strike price	$100	Keep asset + premium	Premium
Above strike price	$110	Asset sold at $100	Premium + $100