Not long ago, because Uniswap did not have its own community governance token, SUSHI took advantage of a loophole and robbed part of its liquidity. After the emergence of this black swan incident, Uniswap issued the governance token UNI after the community voted and re-formulated the liquidity reward mechanism. In addition to the dividends of transaction fees, users who provide liquidity can also get UNI’s Token rewards, thereby regaining some users who provide liquidity.
According to OKLink data, as of today, the total lock-up volume of the Defi protocol on Ethereum is approximately 11.97 billion U.S. dollars, and Uniswap ranks first with a total lock-up volume of 2.01 billion US dollars. After SUSHI robbed part of its liquidity, Uniswap slipped to the 10th place. Now, the amount of locked positions has returned to the top of the DeFi list. While improving the governance of tokens, it also launched UNI's digital currency derivatives options.
As we all know, Uniswap is an Ethereum-based protocol designed to facilitate automatic exchange transactions between ETH and ERC20 token digital assets, and automatically provide liquidity on Ethereum. Uniswap is completely deployed on the chain, and any individual user can use this protocol as long as the decentralized wallet APP is installed.
Option is a perfection of the existing digital currency market. It can be used as a risk hedging tool for spot and contract. When the market fluctuates greatly, it can gain a small gain. With a principal of more than ten US dollars, it can earn hundreds of dollars, even thousands The high-yield of US dollars comes with 1000 times leverage, and futures products such as contracts are crushed by returns. Compared with contracts, it has no margin system and no risk of liquidation. Therefore, since the birth of options, it has been loved by investors and users.
In the entire digital currency market, options account for only about 1%, and there is still a lot of room for development in the future. They are regarded as the next trillion market after spot and contract. This is why Uniswap quickly launched options after issuing the community governance token UNI.
On September 21, Uniswap's UNI Option was launched on BitOffer, the world's largest bitcoin options exchange. On the day of launch, the daily trading volume exceeded 100 million US dollars. Many users reported after trading that the short-term volatility of UNI is relatively large. Compared with options such as Ethereum, Bitcoin, and LINK, it has more room for profit. Compared with other platforms, BitOffer's UNI option is an American option. It has 0 margin, 0 handling fee, no liquidation mechanism, no exercise, and can be liquidated at any time, 24 hours professional customer service online answering questions, smooth APP The experience is full of praise.
According to the analysis of user survey data on the BitOffer platform, UNI’s option trading mainly comes from two parts, one is a single buy, and the other is a contract hedging tool, and the latter accounts for about 40% of the total transaction volume, which shows a lot. Users still don't know the hedging strategy of option + contract, today I will explain it to you in detail.
The strongest hedging strategy that can make money even when UNI contracts are liquidated:
For example, the current price of UNI is $4
1. Suppose you use 100 USD to open 10 times leverage to do long
2. Open 200 put options to hedge at the same time on BitOffer (cost of 10 USD)
3. An option is equivalent to holding a UNI. The option will not be liquidated, will be automatically settled at expiration, and the position can be closed manually in advance.
The first one, when UNI rises by $1, the increase is 25%
1. Go long with 10 times leverage and make 250% profit, which is 250 US dollars
2. The put option loses the principal, which is $10
3. 250-10=240 USD (net profit)
The second type, when UNI falls by 1 US dollar, the drop is 25%
1. Long with 10 times leverage, contract liquidation and loss of 100 USD
2. The profit of the put option is USD 200, and the cost of the option is USD 10
3. 200-100=100 USD (net profit)
After the contract is opened, the option hedging is started, and in the end, no matter what, he can achieve stable profits.