[someben]

When people use derivatives to hedge their exposure to "bad things happening" and the market is not very liquid (i.e. BTC), arbitrage opportunities can persist. For example, if there is no buyer at an out-of-the-money option strike price I know is overpriced, then the market cannot correct itself even though I am "right." When these mis-pricings stick around for a while, the eventual corrections are often much more extreme. Derivatives reduce overall volatility when the spot market is mature and liquid, which is a far cry from MtGox right now.