In September 2023, Ethereum began showing signs of strength after several months of relatively subdued price action. As ETH recovered above the $1,600 level, investors who had been selling cash-secured put options experienced one of the most favorable market environments for the strategy.
This period provides a useful example of how cash-secured puts can perform when markets move gradually higher.
If you are new to the strategy, start with our guide: How to Generate Income With Ethereum Cash-Secured Puts.
Why Rising Markets Benefit Put Sellers
Cash-secured puts generally perform best when the underlying asset remains above the selected strike price.
When Ethereum rises or trades sideways, put options lose value as expiration approaches. This time decay benefits option sellers, allowing them to retain all or most of the premium collected when opening the trade.
During this period, Ethereum steadily recovered while avoiding large downside moves. This created favorable conditions for short put positions.
Market Conditions Matter
Not all bullish markets are equally beneficial for option sellers.
Gradual rallies are often preferable to explosive price moves because they allow traders to repeatedly collect option premium without being forced into constant position adjustments.
In September 2023, Ethereum appeared to be establishing a stronger foundation after a volatile summer period. Market sentiment improved as investors responded to positive developments across both the crypto sector and broader financial markets.
At the same time, implied volatility remained relatively contained, creating an environment where disciplined premium selling could continue without excessive risk-taking.
The Role of Cash-Secured Puts During Bull Markets
Many investors assume cash-secured puts are only useful during market declines.
In reality, cash-secured puts can also perform well during moderately bullish conditions.
When Ethereum remains above the strike price:
- The option seller keeps the premium.
- No assignment occurs.
- Capital becomes available for new trades.
- The process can be repeated.
This creates a systematic income stream while maintaining disciplined entry criteria.
The Opportunity Cost of Strong Rallies
One potential drawback of cash-secured puts becomes apparent during strong bull markets.
If Ethereum rallies aggressively, investors selling puts may collect premium but never acquire the underlying asset.
Meanwhile, investors already holding spot ETH fully participate in the price appreciation.
This is why many long-term investors combine cash-secured puts with direct ETH ownership or covered call strategies.
Learn more: How to Generate Income With Ethereum Covered Calls.
Lessons From This Market Environment
This period reinforced several principles that remain relevant today:
- Cash-secured puts often perform well during stable or moderately bullish markets.
- Premium collection can compound over time.
- Position sizing remains more important than maximizing yield.
- Market conditions should influence strike selection and expiration choice.
- Patience is often rewarded.
While no options strategy works in every environment, this period demonstrated how cash-secured puts can generate income when Ethereum trends higher without excessive volatility.
How This Fits Into a Long-Term Ethereum Strategy
At Terramatris, cash-secured puts are not viewed solely as income trades.
They are also accumulation tools.
By selecting strike prices where we would be comfortable owning Ethereum, we can collect premium while waiting for opportunities to add exposure.
When assignments occur, those positions may later become candidates for covered calls, creating a repeatable options framework.
This process eventually evolves into what many investors know as the Wheel Strategy.
Final Thoughts
Bullish markets often create favorable conditions for cash-secured put sellers.
As Ethereum recovered during September 2023, put options gradually lost value and allowed sellers to retain premium while maintaining disciplined risk management.
The experience highlighted one of the key advantages of cash-secured puts: they allow investors to generate income while remaining patient and selective about future Ethereum purchases.
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