The products currently under development in the retail options section are European-style options, that is options that the buyer must exercise on the expiration date. However, users do not need to worry about the exercise date, because KAKI’s European-style options have developed a new liquidity pool model, which is a WMM-DDH model, integrating option market making and secondary market — -Writer Market Making & Delta Dynamic Hedge.
The figure below is a basic architecture of the WMM-DDH model:
basic architecture of the WMM-DDH model
The three trading pools respectively are:
(1) AH pool, provide options for buying and selling.
(2) S pool, AMM spot pool using x*y=k, similar to Uniswap, approach for hedging Delta risk.
(3) Sigma pool, a volatility trading pool using the virtual AMM mechanism(VAMM), is used to hedge Vega risks.
KAKI is a relatively complex protocol. It ensures that option buyers can earn reasonable alpha gains, and also can sell options at any time for cash settlement. KAKI protects LPs for stable returns, hedging Delta and Vega risk and harvesting Theta and RHO gains.

On this basis, the WMM-DDH model can provide these services as follows:

🍊Buying spot
🍊 Selling spot
🍊 Buying specified option contracts
🍊 Repurchasing option contracts
🍊 Early execution options contracts
🍊 Exercising option contracts at the expiry date
🍊 Option perpetuation services