In recent months, there has been a lot of talk about the death of defi. This could be due to the downtrend or the collapse of Luna, but the TVL (total value locked) of all defi protocols has dropped more than half since a few months ago.

In the last Defi summer, we saw the raise of high APY protocol, any people can folk any open source defi protocol like uniswap v2, Aave, Compound, Curve,… in new chain. They are willing to pay high yield by infation token. Normaly, 3~400% APY is considered low APY. We can see many protocols offer up to millions of percent each year! The reason for this is that people want to make money and they think that these high APY protocols will make them a lot of money. However this is not true! All of these protocols are going to zero because there is no value in them!

                                                                       Forked Protocol

In the cryptocurrency world, when a coin goes into decline, there are often new projects that claim to be the "defi 2.0" or the next step in decentralized finance. Recently, Olympus Dao has proposed a new concept based on game theory and a (3:3) token model. They are offering 200k% apy for those who buy their discount bond and stake. However, despite this high apy rate, the token price has dropped from 1400 to 14 and apy has gone down to 800%. Why is this?

One possible reason is that investors are not confident in Olympus Dao's ability to deliver on their promises. The team has not released a working product yet and there is no guarantee that they will be able to pull off their ambitious plans. Additionally, there is significant competition in the defi space right now and it may be difficult for Olympus Dao to stand out from the crowd.

Another possibility is that investors believe that current projects offer more value than Olympus Dao does currently. For example, Compound offers an apy of up to 5% while still having a working product with real-world use cases.

The Curve protocol has been released, and with it the veToken. This new token is designed to curb inflation of token farming and stabilize the CRV price. The longer you lock your CRV, the more you get in veCRV tokens. This seems to be working so far; in the last downtrend, CRV price didn't drop too sharply. More than half of all CRV tokens are now staked, meaning that they are locked away for a period of time in return for a share of the yield from the stable pool. In this way, Curve is selling inflation for the future; there is no guarantee that whales will not dump and bankrun in the next cycle, but this system does provide some stability to proceedings.

In the final, how can we get real yield farming with out dump the project token?

The answer may be protocol revenuve.

There are many way that protocols can earn revenuve, for example : trading fee, interest rates,… In the case of Uniswap v3, people can add concentraded liquidity to get high trading fee. But the nagative is that the yield is unstable, people can be affect by impermanent loss, low tvl pair with low volume,….

The Dydx Protocol has seen substantial profits for traders. However, there is one major issue with the protocol – holders of the DYDX Token do not benefit from these profits. This is due to the way in which rewards are distributed within the protocol. Instead of rewarding those who hold DYDX Tokens, rewards are given to those who contribute liquidity to the network by placing orders and providing liquidity. As a result, traders who do not hold tokens can earn more rewards than those who do hold tokens. In addition, holders of tokens are also affected by inflation as new tokens are created as part of the incentive trading program.

Aave is top 1 lending protocol, which have organic yield from interest rate. That is healthy yield, but in general, the yield is are not high enough to attract retail users. One more problem, the capital usage is not high, the loan rate is twice the loan rate, this lead to , that leads to difficulty in making the most of capital.

In Defi space, organic yield also come from options.

In fact, options are a rather complicated product even for the traditional financial markets where there is a long history of development. Therefore, when applying the traditional Options model to the DeFi market, many problems have occurred, such as:

+Liquidity fragmentation. +The liquidity used is not optimal. +It costs too much to maintain the position (for Traders). +Often causes heavy losses for Options Writers (Liquidity Providers or Market Makers) due to the “one-way” nature of the market.

In the above context, DeFi Options Vaults (DOVs) are products built around the main Options Protocol to solve the problems that DeFi Options encounter as mentioned above.

The basic operating model of DOVs is as follows:

Users will first deposit their assets into the Vaults of the project. Vault will then use that asset to provide liquidity (or Write Options) on Options Protocols according to different strategies. In addition, these Vaults will also be designed to choose the most optimal Strike prices and expiry times. The amount of Yield that Vault earns (mainly from Options fees) will be used to reinvest to help Users get the most optimal profit. In short, retail investors only need to deposit property to receive interest, no need to care about anything else.

DOVs bring a huge amount of “Organic Yield” to users.“Organic Yield” here you can understand that Yield is born from revenue generating activities of the platform, not from Native inflation token.

A few examples that give a fairly high 3-digit Organic Yield level in the DeFi market today, I can mention such as Ribbon, Thetanuts,…

In order to do that, most DOVs only apply 2 main strategies: Covered Call and Put Selling.

Finally Defi will not die but evolve to seek profit for users without needing to inflate native tokens. Maybe the new wave will start with “organic yield protocols” or an alliance between them.

Resource: https://coin98.net/defi-options-vaults-dovs-la-gi https://momentum6.notion.site/DeFi-Options-Trading-901ccbe7ec7e4f47a4e107bbd1da7f7e

In recent months, there has been a lot of talk about the death of defi. This could be due to the downtrend or the collapse of Luna, but the TVL (total value locked) of all defi protocols has dropped more than half since a few months ago.

In the last Defi summer, we saw the raise of high APY protocol, any people can folk any open source defi protocol like uniswap v2, Aave, Compound, Curve,… in new chain. They are willing to pay high yield by infation token. Normaly, 3~400% APY is considered low APY. We can see many protocols offer up to millions of percent each year! The reason for this is that people want to make money and they think that these high APY protocols will make them a lot of money. However this is not true! All of these protocols are going to zero because there is no value in them!

                                                                       Forked Protocol

In the cryptocurrency world, when a coin goes into decline, there are often new projects that claim to be the "defi 2.0" or the next step in decentralized finance. Recently, Olympus Dao has proposed a new concept based on game theory and a (3:3) token model. They are offering 200k% apy for those who buy their discount bond and stake. However, despite this high apy rate, the token price has dropped from 1400 to 14 and apy has gone down to 800%. Why is this?

One possible reason is that investors are not confident in Olympus Dao's ability to deliver on their promises. The team has not released a working product yet and there is no guarantee that they will be able to pull off their ambitious plans. Additionally, there is significant competition in the defi space right now and it may be difficult for Olympus Dao to stand out from the crowd.

Another possibility is that investors believe that current projects offer more value than Olympus Dao does currently. For example, Compound offers an apy of up to 5% while still having a working product with real-world use cases.

The Curve protocol has been released, and with it the veToken. This new token is designed to curb inflation of token farming and stabilize the CRV price. The longer you lock your CRV, the more you get in veCRV tokens. This seems to be working so far; in the last downtrend, CRV price didn't drop too sharply. More than half of all CRV tokens are now staked, meaning that they are locked away for a period of time in return for a share of the yield from the stable pool. In this way, Curve is selling inflation for the future; there is no guarantee that whales will not dump and bankrun in the next cycle, but this system does provide some stability to proceedings.

In the final, how can we get real yield farming with out dump the project token?

The answer may be protocol revenuve.

There are many way that protocols can earn revenuve, for example : trading fee, interest rates,… In the case of Uniswap v3, people can add concentraded liquidity to get high trading fee. But the nagative is that the yield is unstable, people can be affect by impermanent loss, low tvl pair with low volume,….

The Dydx Protocol has seen substantial profits for traders. However, there is one major issue with the protocol – holders of the DYDX Token do not benefit from these profits. This is due to the way in which rewards are distributed within the protocol. Instead of rewarding those who hold DYDX Tokens, rewards are given to those who contribute liquidity to the network by placing orders and providing liquidity. As a result, traders who do not hold tokens can earn more rewards than those who do hold tokens. In addition, holders of tokens are also affected by inflation as new tokens are created as part of the incentive trading program.

Aave is top 1 lending protocol, which have organic yield from interest rate. That is healthy yield, but in general, the yield is are not high enough to attract retail users. One more problem, the capital usage is not high, the loan rate is twice the loan rate, this lead to , that leads to difficulty in making the most of capital.

In Defi space, organic yield also come from options.

In fact, options are a rather complicated product even for the traditional financial markets where there is a long history of development. Therefore, when applying the traditional Options model to the DeFi market, many problems have occurred, such as:

+Liquidity fragmentation. +The liquidity used is not optimal. +It costs too much to maintain the position (for Traders). +Often causes heavy losses for Options Writers (Liquidity Providers or Market Makers) due to the “one-way” nature of the market.

In the above context, DeFi Options Vaults (DOVs) are products built around the main Options Protocol to solve the problems that DeFi Options encounter as mentioned above.

The basic operating model of DOVs is as follows:

Users will first deposit their assets into the Vaults of the project. Vault will then use that asset to provide liquidity (or Write Options) on Options Protocols according to different strategies. In addition, these Vaults will also be designed to choose the most optimal Strike prices and expiry times. The amount of Yield that Vault earns (mainly from Options fees) will be used to reinvest to help Users get the most optimal profit. In short, retail investors only need to deposit property to receive interest, no need to care about anything else.

DOVs bring a huge amount of “Organic Yield” to users.“Organic Yield” here you can understand that Yield is born from revenue generating activities of the platform, not from Native inflation token.

A few examples that give a fairly high 3-digit Organic Yield level in the DeFi market today, I can mention such as Ribbon, Thetanuts,…

In order to do that, most DOVs only apply 2 main strategies: Covered Call and Put Selling.

Finally Defi will not die but evolve to seek profit for users without needing to inflate native tokens. Maybe the new wave will start with “organic yield protocols” or an alliance between them.

Resource: https://coin98.net/defi-options-vaults-dovs-la-gi https://momentum6.notion.site/DeFi-Options-Trading-901ccbe7ec7e4f47a4e107bbd1da7f7e