Please describe your proposed solution.
- We introduce financial options to the ecosystem, which has a -1 to 1 delta exposure, enabling full spectrum of delta management. The changing delta depending on the distance between strike price and spot price enables tail risk management. Time decay on option price also introduces the second dimension of risk factor for dynamic risk exposure on the portfolio.
- Decentralized financial options can also further improve price discovery of highly traded cryptocurrencies as well. We acknowledge that there are market participants who prefer pure private custodians due to security or other concerns. In turn, for all the ample of products provided by CEXes, the decentralized option could be the preferred channel for them to reflect their investment view on the cryptocurrencies.
- From the product standpoint, both the retail investors and institutional traders would be directly benefited from the application we provide as there is a brand new on-chain product as one of the core trading tools.
- Macro-speaking, the whole Cardano ecosystem would be benefited as a whole as extra financial management tools would inject extra liquidity to the ecosystem, fostering higher degree of Cardano on-chain activities.
How does your proposed solution address the challenge and what benefits will this bring to the Cardano ecosystem?
- The core pain point DeltaDeFi is attempting to solve is the lack of financial product for users to manage portfolio dynamic risk exposure. From a product standpoint, introducing financial options to the ecosystem provides an extra tool to manage portfolio risk on-chain. Reduce the reliance on centralized exchanges.
- We aim to introduce extra liquidity to the market. By inviting institutional market makers, extra liquidity would be injected into the Cardano ecosystem. Improving overall trading experience on several DEXes.
- Enhance the TVL of Cardano ecosystem as a whole.
- From an infrastructure standpoint, our team strives to research and develop an efficient order book model. Upon success, it could be one of the core backbone supporting Cardano’s DeFi ecosystem.
How do you intend to measure the success of your project?
- Number of partnered market makers
- Number of option contract initiated
- Number of unique wallets interacting with the protocol
- Total value locked
Please describe your plans to share the outputs and results of your project?
- The smart contract would be open sourced once we get a reasonable assurance on its security from an external auditor. It would be one of the examples of Cardano smart contracts in the community for education.
- In DeltaDeFi, we are dedicated to research and develop an efficient order book trading model which is eUTxO native. This would become the backbone of our further development in several DeFi products.
- We believe it is more important for the Cardano ecosystem to succeed as a whole rather than confining the success to the project itself. That being said, we would strive to balance, to an extent which our project team is motivated to keep on researching and developing.