Why NiftyOptions?

As an NFT holder, what is my incentive to create an option?

If the market is volatile then you're guaranteed to get the NFT or the liquidation strike price

Scenario:

Assume that you just purchased a valuable NFT, such as an Artblocks Curated Subscapes for the floor price (lowest price) for 65 ETH. In order to hedge your investment, you create a new Nifty Option by depositing the NFT in an escrow along with an incentive of 1 ETH and you set a strike price of 50 ETH and duration of 6 months.

Now, anyone can earn that 1 ETH by fulfilling the option. To do this, they need to deposit 50 ETH (strike price) in escrow for up to 6 months. They will immediately earn the 1 ETH for doing so and within 6 months, they are guaranteed to either receive the 50 ETH back or to receive the Subscape. They do not get to choose. The original creator of the Option, you, have the option during those 6 months to either call cancelOption() or call exerciseOption(). Cancelling the option returns the NFT to the option-owner and the 50 ETH to the fulfiller. Exercising the option sends the NFT to the fulfiller and the 50 ETH to the option-owner. After 6 months, if the option-owner has done neither, then anyone (such as the fulfiller) can call expireOption() in order to Cancel it, returning the NFT to the option-owner and the 50ETH to the fulfiller. The fulfiller keeps the 1ETH incentive in all cases as a reward for locking up their ETH and potentially losing it to receive the NFT, at the discretion of the option-owner who paid the 1 ETH.

The 50 ETH strike price and 1 ETH incentive fee are completely discretionary amounts and will vary on a case by case basis, always chosen by the creator of the option.

The filler is who ends up buying the NFT for the strike price.

The person who mints the contract initially owns the option and they are in control of the terms and can keep or sell the option to another party.