Source : coinquora.com
- Volatility Tokens ETHVOL and CVOL now live on both the secondary markets and the CVI platform.
- The tokens are the first of their kind funding-fee-adjusted-rebased Volatility Tokens.
- ETHVOL is pegged to ETHVI index while CVOL is pegged to CVI.
Cryptocurrency Volatility Tokens, ETHVOL, and CVOL are now available on the CVI platform. Also, the tokens are presently available on the secondary markets. The Volatility Tokens are a transformative remedy for trading crypto volatility. The team behind the project credits the token as the first of its kind funding-fee-adjusted-rebased volatility tokens.
Notably, cryptocurrency, in general, is known to be volatile in nature. In spite of this, many have amassed a fortune from investing in crypto while also suffering huge losses when the market goes bear. Investors keep questioning why crypto is so volatile.
A question that keeps ringing out from investors to crypto inventors and analysts. While many attribute the instability to speculations, fragile investors, the emerging market, and so on, some still feel the volatility is beyond anyone’s understanding.
However, Volatility Tokens have succeeded in bringing a new way of trading volatility, while makingCVI compatible with the greater Defi ecosystem, thus achieving another major milestone.
Fortunately, some projects such as ETHVOL which was the first Volatility Token to be launched, are focused to reduce or eliminate investors’ losses through developing their own Volatility Tokens.
In detail, ETHVOL is pegged to the new ETHVI index, which tracks Ethereum’s volatility Ethereum. Moreover, ETHVOL can be traded on the Ethereum based DEX Uniswap V2, attracting the attention of traders and arbitrageurs when there is a difference in prices between the Uniswap and the CVI platform.
On the other hand, CVOL is the second volatility Token available for trading. It is pegged to the CVI index and tracks the implied volatility of Bitcoin apart from Ethereum. Similarly, CVOL can be traded in the Polygon network on QuickSwap.
Of note, all the Volatility Token’s arbitrage-related operations performed on the main platform (mint/burn) will result in an increase in collected fees distributed to GOVI stakers. Besides, Buying ETHVOL and CVOL tokens on secondary markets is equal to taking a long position on ETHVI and CVI indexes.
Unlike opening a position on the platform, when you buy Volatility Tokens, you can sell them immediately on secondary markets without a lockup period. Interestingly, there are no purchase or sell fees. Finally, you can stake your LP tokens and earn GOVI rewards, and Uniswap/Quickswap fees. In particular, there is no lockup period on claiming your GOVI.
Above all, the Volatility Tokens bring major benefits to the entire ecosystem. Users can buy or mint ETVOL/CVOL tokens to provide liquidity to ETHVOL-USDC pool on Uniswap and CVOL-USDC pool on QuickSwap. Additionally, they can stake their ETVOL-USDC and CVOL-USDC LP tokens on the CVI platform and earn GOVI rewards.
Every ETHVOL/CVOL token holder pays a fee to the liquidity providers of the USDC pool on ETHVI/CVI platforms, making the liquidity providers profit from all the ETHVOL and CVOL tokens in circulation. In summary, it is advised that investors should ensure that they implement strategies that “manage” risk and uncertainty when the market is fluctuating. The team further says it has compiled all the relevant technical information in an easy-to-read Litepaper to shed some light on the logic behind each step of its development.