DEXTF Protocol announced launch of new batch of tokens in $ ETH

DEXTF Protocol announced last Tuesday, July 27, through its Twitter account, the launch of a new batch of floor tokens structured in $ETH, in association with Opyn and UMA Protocol, using their zero coupon bond tokens.

Image about DEXTF’s post on Twitter

“We are delighted to announce the launch of a new $ ETH structured floor token developed in partnership with Opyn and UMA Protocol. The new SFT has an exercise price of US $2,500 per $ETH that expires on December 31, 2021, built by combining options from Opyn and zero-coupon bond tokens from UMA”, he said through an article published on the Medium platform.

The problem

The company explained that two weeks after their Mainnet launch (in September 2020), they created the first iteration of SFT, combining yUSD (for performance) and a call option (Opyn) in ETH.

This approach had 2 main problems:

• yUSD returned a floating return, leading to a possible floating floor price of SFT (not capital efficient either).

• Liquidity was tight as SFTs minted with assets available at the time.

The solution

In their view, after the well-received launch of several batches of SFT, they accepted the advice of the community to generate enough liquidity to meet the growing demand for these products.

This partnership made possible the use of capital efficient UMA Zero-Coupon Bond tokens that replace yUSD.

The company explained that the UMA ZCB tokens are a longer maturity version of the UMA yield dollar.

“ZCB tokens are secured debt sold at a discount by borrowers on the market. ZCB buyers are therefore lenders. This is a higher asset than yUSD because the return is known and fixed once you buy it from the market. The market price of the ZCB token corresponds to the present value of the loan at maturity”, he added.

Similarly, he stressed that the longer the expiration, the cheaper the time value of the structured token, which means that the structured token will have a relatively higher participation rate. Therefore, if the investor was very optimistic about the underlying but did not intend to be fully exposed to it, sticking to SFTs turns out to be the most efficient way to invest.

Also read: Secret Network announced $SEFI launch

Where to exchange them

The company indicated that its new SFTs will be traded on DEXTF V1 Marketplace *, its internal DEX based on the 0x protocol. *SFTs do not require rebalancing. When we complete module 0x, we can launch them in DEXTF V2 Marketplace.

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