DeFi investment firm MEVCapital launches options-based hedging strategy for Uniswap liquidity pools. By IanAllison123.
, often emulating the way traditional finance works, is being brought to DeFi to make the space more palatable to institutional investors. Impairment loss occurs when a drop in token prices impacts assets in a liquidity pool.
MEV Capital uses options contracts issued by crypto derivatives specialist OrBit Markets to hedge liquidity providers’ positions andAt maturity, the options contract is settled over-the-counter with either MEV Capital covering the balance if the liquidity providers' position has increased in value, or the options desk settling the difference with MEV if the LP position is worth less than the hedged amount, explained MEV Capital chief investment officer Laurent Bourquin.
“It's kind of trendy nowadays to do Uniswap v3 impermanent loss hedge,” said Bourquin in an interview. “We have hired quants to make sure the options we buy fully hedge our LP position. Everything is on-chain and public. We are using only one protocol that we trust and the yield is paid in USDC and Ethereum,” Bourquin added.
Malaysia Latest News, Malaysia Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Week in DeFi: USDC Depeg Sparks DeFi Crisis, LSD Still In and Cosmos MEV in Focus | CoinMarketCapThe circle-backed stablecoin, $USDC, depegs swiftly as part of Circle’s cash reserves are disclosed to be held at Silicon Valley Bank. Let’s see what else went down this past week in DeFi 👇
Read more »
MEV Rewards on Ethereum Reach All-Time High During SVB Bank Run and USDC DepegLast Friday’s SiliconValleyBank collapse led to an all-time high in ETH MEV rewards, cryptauxmargaux writes for this week’s Valid Points newsletter.
Read more »
DeFi Privacy Bridge Aztec Connect Sunsets After Less Than a YearEthereum privacy layer aztecnetwork has sunset its Aztec Connect bridge, open-sourcing the protocol to move on to new products. BrandyBetz reports
Read more »
Euler attack causes locked tokens, losses in 11 DeFi protocols, including BalancerSome protocols have been indirectly affected by the exploit due to exposure to Idle Finance or Angle Protocol.
Read more »
California’s gig worker-focused Prop 22 isn’t overturned after allA 2021 decision declared it unconstitutional, but it’s been overturned.
Read more »
Coinbase Is Adding DeFi Apps UniSwap and Aave to Its Base Blockchain: SourceSCOOP: Crypto exchange coinbase is adding DeFi majors Uniswap and AaveAave to its recently launched L2 blockchain, Base. IanAllison123 reports
Read more »