NEAR NEARCON | 2021, 9 Nov 2021

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From YouTube: NEARVERSE - Day 2 - Zoo, the DeFi Index Protocol for the Multi-Chain Future

Description

Marshall Chang, IndexZoo, CEO

Blurb: As the multi-chain future starts to shape out, it becomes essential for DeFi users to access investment exposures cross-chain. Zoo’s Index protocol is the perfect solution, letting users gain access to any basket of cryptos from different blockchains across bridges to Ethereum, and also enables leverage for both long and short exposures. Join IndexZoo to learn more about its innovative index protocol building on NEAR’s infrastructure.

Long: The talk will go over IndexZoo’s plan to build the most accurate, the highest leveraged and the lowest cost tokenized indices providing cross-chain exposures to DeFi users. Marshall, CEO of IndexZoo will talk about the current landscape of DeFi indices, the problems and the opportunities, and most importantly how IndexZoo will contribute to making investment an easier and better experience for users.

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A

Hey everyone, um I'm marsha chang and I'm ceo of index- do I'm very happy to share with you guys what we're building here today at nerdcon and uh how we're building this near. um So here yeah, let's get started basically uh so index. Do we are a d5 index uh protocol um to build tokenized index for any basket of cryptocurrencies?

A

We are a cross-chain ecosystem of index. That's built for three parts. uh Number one is automate optimal accuracy number two is maximum leverage, hence for maximum capital efficiency and then number three is the lowest cost. Because um token x, index mirrors uh tried by etfs, and the ets always have the lowest cost.

A

So that's why it has the most aun so we're um that's the three main goals: how we're building index new um and we're also building it to be crosstained, because uh we believe that the future of d5 will be cross-chain will be multi-chain and it's important for users to users from any blockchain to access indexed liquidity to any other blockchain.

A

So currently, um the default index has really exploded this year with d5 pulse index. But here are some major problems that we cannot ignore. Number one um there's currently only long tokens there's a lack of diversity um because there's, um even though there are leverage tokens, it's generally pretty low like two times leverage. That's because currently the leverage tokens got the leverage from boring, which is uh frankly speaking, uh not very efficient.

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Number two is the biggest problem with uh d5 index. Today we think is the inaccuracy. um That's due to the rebalancing is generally pretty infrequent because it's very costly to rebalance on the theorem, um because it's with the gas fee and uh yeah. So the uh number three is the high cost, um not only you pay gas fee to buy and sell the token, um it's also almost impossible to mean or redeem the token because of the um just because of like the gatsby in terms of in regard to the index transactions.

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So um here is what we found from the eco, uh the community, um what people campaigns the most? It's really the inaccuracy.

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So here this user bought a flight two times uh leverage token on either, um but on the day that is, zero went up 3.6, they actually went up only 2.6, so less than the underlying online asset. So another user was actually kind enough to explain that um you for sure not get the two-time leverage most likely, because crypto rise is so fast, and these two can only rebalance one day once per day, um so you'll be on the lower end of the leverage.

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So this is certainly not ideal, because people buy the leverage tokens to actually get the leverage um and you are actually paying like fees. Very high fees like two two percent annualized fees to get to use the token. So um the very average is the biggest issue with the tokens.

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So in order to solve this problem, um our solution is to use uh layer, two traded, uh dex perp contract, as opposed to using the layer one spot market. So our index actually get exposures from uh dydx. uh They have the layer. Two perk now um also uh like protocol, which is also launched in their v2, carry and also other exchanges like kind which are on upcoming as well.

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So our index will actually get a leverage exposure through like margin trading on the perp contract, as opposed to current uh protocols which gets uh layer, one spot market exposures and get the leverage through boring or landing on ave. um So it's much more costly to do it. That way, um and if you look at the trifei, all the indexed etfs are actually using the derivatives as opposed to the spot market.

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So we think this is the right way to do it, um and if this this uh this method, it's actually a ton of benefits, um so obviously, with layer 2, you save cost by a lot, meaning that the token can rebalance much more frequently, meaning that the users will get much more uh accurate, near perfect tracking accuracy of the underlying asset, which is really what the index tokens are all about.

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uh Number two: we can provide inverse exposures um because using the perk contract to go long and short, it's really just a flip of a switch. We can also we're also building volatility, tokens that are on the uh derivatives x uh option directory decks. um Currently uh uh there are occupy n and hagic, so eventually we'll build on top of their protocol.

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Just like we build on top of d by dx and purple protocol to provide you service volatility exposures as well um and yeah, and we can also have much higher leverage with the derivative method just because uh it's essentially you're managing a margin trading account that you don't really manage or collateralize that position, so you can have.

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You can go much higher in terms of leverage um and also have a much much tighter risk management just because the trading finality is also instant under on this layer tools nowadays, um number three: we want users to create their own index, um so we want to eventually modulate our protocol so that users can utilize our long and short, bear and vote tokens to create their own portfolio um and also to be across change and then to build uh index for different ecosystems, because the futures market chain that every change we believe needs a index uh protocol.

A

um That's why you'd like to do will launch to be multi-chain at the get-go. So, um yes, talking about multi-change users actually really want to bet bad tokens uh uh on any chance other than ethereum. Here are these tokens asking? Where are these users asking where you can get some flight tokens, um arbitron optimism or polygon just literally anywhere, besides these?

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um Just because how hard it is uh to just pay the gas fee um and, like I said it's impossible to meet and redeem, so our uh launch at our product launch will uh simultaneously launch its own mirror as well through the our lower page, so that users out near can get our token at the fraction of the cost. As uh on the ethereum um and keep in mind.

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So our uh method also saves yes v as well, because if you look at um like a dpi index token, what you mean it's actually cost like five hundred dollars to mean two to twenty dollar worth of tokens. That's because each means meaning to buy like 10 different tokens on layer. One now with us. It's really just one transaction and we'll uh deposit to the next derivative taxes and use cost margin trading. To actually give you the exposure uh much more accurately, but also cost a lot less um and yeah.

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So we're also going to launch everything on here. We are going to uh we've uh have partnership on here with mir and we're very excited to build uh our protocol on here as well, so that users have the most frictionless experience yeah. So, in the beginning, we're launched with the bear and the ball token. um These are our long and short passive indices. um You have the bitcoin and the ethereum three times long and short, and also uh potentially a near three times long as well.

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So compared with our of other leverage tokens, we actually use a fixed mandate. That is because we actively rebalance intraday as opposed to rebalancing at a fixed time uh per day once every day. So this means uh you, you can actually always get the predictable, uh predictable leverage.

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um We do not uh have the mandate to rebalance at a given set time, so we are, we rebalance as people come in and not, um and it's uh that's because we can actually believe this uh much more costly cost effectively on layer two um and if you wanna, definitely uh check out our dock, to read more and learn more about our uh rebalancing mechanism. I've posted a link here down below um yeah in the future. We are uh very excited to build more active tokens like the uh the active universe.

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Token called smart panda essentially think about our bear and ball tokens is passively tracking the market. It gives you maximum predictability, um but it doesn't give you anything more than that, so the active tokens are going to be more niched, more alpha, focused and actually we'll try to over leverage and d leverage at certain times. Hence providing you uh the market alpha, so we're very excited to build that into our uh line. Product lineup as well, uh the same with the fear volatility token, which I've talked also uh just now.

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um It will connect with x uh options, contract uh protocols and provide you volatility exposures making beyond change. So currently, there are wall tokens if you're into the derivative space. um There are wall tokens that are, but mostly those are synthesized, meaning that uh they still calculate they still use, centralized exchanges like derivative. They would calculate a number there on their big big index and then um kind of synthesize that exposures on chain between long and short users, um which it's not not the most organic way, but definitely the easiest way.

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So our goal is, but our goal is actually to connect with uh being composable with other d5 projects and then build the whole uh exposures for users to hatch and speculate natively on chain um which we believe as the options market grows, will be very possible. But those are in our pipeline as well and here's our ui. We actually have a very simple dev design.

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It's all in one page, um you'll be able to uh see our different tokens um buy and sell and reveal your leverage with your balances or in this one page, um our we are a fairly young project we launched early this year um and right now we are preparing for our um tesla launch and then followed by the midnight launch, um so that will be towards at the end of this year, definitely um join our telegram with discord to get updates.

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um So we, like, I said uh our token- will simultaneously launch from the ethernet plan here. So if you're already on here definitely you'll be able to get the tokens much cheaper price um and then going forward. We also plan to launch our governance token, that index to ico token, um which will be- uh uh which I think uh will be our governor's and utility tokens.

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So um uh so these the the specs for our tokens are are constantly being updated because we haven't finalized yet, um but what we are sure of is we want, I uh our governance, token holders uh to have hundred percent of the platform's uh profits, um because we um are. We believe that um it's that as a new next product, it's very important number one for product launch and we believe in uh user designed uh index, um because we've seen the enthusiasm enthusiasm for users to have their own tokens.

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So we want users to share the the profit of the the protocol. um The hundred percent, um also, we saved a fairly amount of tokens for liquidity and utility mining. um The goal is to encourage users to stay under our platform, because we will be able to have long and short and any other, and also more exotic exposures for users to construct their portfolio returns. So we want to incentivize users to be in the indexed ecosystem and then use use our products to construct their portfolio.

A

um Yes, to summarize, what makes this difference? It's um number one we are built for capital efficiency, it's our five times, leverage um and number two we are built for at at most accuracy um through our rebalancing mechanism, which is very active, which is enabled by the layer. Two methods uh number three is uh to pass those costs at low cost to the users.

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So not only we, we will charge less because it just costs less to trade on later too, but you also be able to buy us, buy the tokens on other chains um like near um to save gas. um You can also meet our tokens at a much lower cost than on the ethereum right now, yeah. So uh going forward um just to uh open up the discussion, we have other plans for um different applications like the nft index, um so that you, you can just hold one index.

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uh It has like a range of nfts, give you exposures uh that way, perhaps even short, exposures and nfts, um and also the active tokens and perhaps even uh yield farming focus. So we have a lot of products in our pipeline um and uh it's our. The goal is to let any uh any user any d5 users to find something that they can use from the index to ecosystem, and this is our team.

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We mainly come from a tri-fi background, um so we previously we were co-traders, uh we create our own accounts and also we build algorithms for other companies. um So I'm uh marshalltron uh and I have my partner camera, who used to work from battle reserve uh bill.

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Our cto, who used to work in software development and also uh since 2018 he's been a blockchain native um and also jet, which is our product developer developer, um he's very knowledgeable on the index space on your treadview and then our goal is to build the uh the the eps of 25 to defy um sort of to have the benefits of low cost and accuracy from traffic, uh but also in d5, with benefits of custodial as uh decentralization and then permissionness and uh security.

A

So yeah, that's us index do very happy to share with you guys today are near khan. We're very excited about our partnership with nir. um If you have any question, definitely show me an email or add me on telegram happy to talk more, and I hope you guys enjoy your time here at nerdcon.