# kaal:claim:3782216-023

**Claim.** Decentralized derivatives must be capitalized at least fully because the platform and its anonymous users cannot be trusted, a requirement that would be impossibly onerous in traditional markets and that leaves the market for decentralized options extremely shallow.

**Type.** failure  **Support.** argued

**Holds when.**

- decentralized options and derivatives markets at the time of writing

**Source quote.**

> the inability to trust the platform or the anonymous users requires these decentralized derivatives to be capitalized at least c::%, which would be impossibly onerous in traditional markets.

**From.** Craig Calcaterra, Wulf A. Kaal, *Decentralized Finance (DeFi)* (2021), The basic financial markets

**Cite as.** Craig Calcaterra, Wulf A. Kaal, Decentralized Finance (DeFi) (2021). SSRN: https://ssrn.com/abstract=3782216

**Verify.** sha256 of source PDF `f1739743aa06bbc1641cd65da790d531b69d8628ea3f5cc3fcad1bf5a1242373` at https://raw.githubusercontent.com/wulfkaal/Academic-Papers/main/papers/pdf/Calcaterra%20and%20Kaal%20-%202021%20-%20Decentralized%20Finance%20%28DeFi%29.pdf

**Failure mode.** derivatives overcollateralization  (family: liquidity-and-market-structure-failure)

**Topics.** reputation, defi

**Keywords.** derivatives, overcollateralization, reputation, liquidity

**Canonical form.** This markdown file is the canonical hashed representation of the claim. Its sha256 is the content hash used for attestation.