Welcome to this week’s coin review! With a new Bitcoin all-time high just minutes away at the time of writing, Moonvember looks to be kicking off without a hitch. Sidelined blockchain Kadena has been put into the spotlight this week with its 150% run. Trailing behind is Loopring with 100% gains and Crypto.com stepping to the top for the first time in almost a year with 80% gains. Being the least expected runner is kind of a homage to previous bull runs. With the biggest winners and top gainers almost never turning out to be who the market expected. Testifying how important diversifying your portfolio across different blockchain use cases can be when money is being thrown at everything. Today we’ll be looking at what’s still considered a newer use of DeFi with options trading on Dopex Protocol.
Introduction
Dopex Protocol is a decentralized options exchange protocol that aims to maximize liquidity, cut losses for option writers and maximize gains for option buyers. Without requiring the user to learn any new technologies. Dopex operates in a passive manner for all liquidity contributing participants. Option pools available for all options on Dopex allow anyone to take part and deposit base/quote for their respective pools to gain passive income from option writing. Dopex also enables the purchasing of discounted options through liquidity pools which could then be arbitraged for an instant profit. A unique rebate mechanism allows for option writers to gain a superior return in comparison to writing naked options or hedged option writing strategies of any type. Dopex options are built to closely mimic Deribit options as much as possible considering its dominant market share in the space currently. The Dopex Protocol consists of many moving parts to provide a liquid, well-incentivized platform replicating successful option platforms by making use of Sushiswap, Chainlink, and UMA Protocol in its core architecture. Dopex uses assets from the asset pools along with Black-Scholes price accounting to allow anyone to buy options based on strikes of their choice for future expiries. Dopex enables anyone to become a liquidity provider by adding base or quote assets to Option and Liquidity pools.
Existing option providers need the user selling volatility to decide which strikes and expiries they’d like to provide liquidity for while constantly scanning order books for buy-side liquidity. Dopex makes use of option pools allowing anyone to earn a yield passively by selling options to purchasers with minimal interaction with the underlying protocol. Pool participants can simply deposit base or quote assets to a pool which would be utilized as liquidity to users looking to buy a call and put option. Like Single Staking Vaults, Single Staking Option Vaults allow users to lock up tokens for a specified period of time and earn a yield on their staked assets. Users will be able to deposit assets into a contract which then sells your deposits as call options to buyers at fixed strikes that are selected for end-of-month expiries. Dopex offers a feature that allows users to swap their options for a different expiry and/or strike price at any time. This allows users to swap their options without worrying about the current liquidity for their available options in the market. This is due to the swap being done by changing the…
Hi! My name is Lark Davis!
I’m a cryptocurrency investor with years of experience and I’ve been making consistent profits in the crypto space.
I’m passionate about helping others do the same, so I run multiple educational channels on crypto investing.
