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The wheel strategy (a.k.a "options wheel strategy") is a two-step "Buy Low-Sell High" income strategy used by stock options traders who sell cash-secured puts and covered calls in order to receive stock at a discount, and then sell at an above-market price. With just a few small adjustments, crypto traders can also benefit from this strategy.
An investor continually sells (writes) Out-of-The-Money (OTM) cash-secured puts to collect option premium.
If at the predetermined expiration date the option expires worthless, the writer keeps all the premium — repeating the process until a put eventually expires In-The-Money (ITM).
A put option expiring in-the-money (ITM) exercises automatically.