Decentralized finance (DeFi) is evolving at such a fast tempo that new funding autos are being rolled out every day, and Opium is providing the most recent.
In what it has described as “a technique for bearish buyers” the artificial derivatives Opium Community has unveiled a product providing safety in opposition to massive downwards actions in Ethereum costs.
Opium defined that its “ETH Dump Safety” is predicated on a “protecting put” which is a technique for buyers who imagine that the worth of an asset will decline sooner or later, including:
“It may be utilized by bullish buyers to hedge in opposition to potential losses and get a safety to the draw back,”
In a tweet on June 13, Opium stated that it really works like some other decentralized insurance coverage. Traders buy safety for a premium and within the case that the asset drops beneath the strike value, they obtain the distinction between the strike value and the present worth of ETH.
Encouraging the bears
Derivatives present the choice to quick an asset, and this primarily is encouraging that motion by providing rewards if the asset crashes.
“If you’re bearish on an asset, you need to use ETH Dump Safety as part of the basic shortening technique – for those who imagine that ETH will plummet moderately than develop, buy ETH Dump Safety and obtain payouts when ETH goes down.”
The providing is a part of the protocol’s Opium Insurance coverage suite launched in December 2020 providing differing ranges of safety for varied DeFi methods, good contracts, and crypto property.
In early April, Opium Finance partnered with Gnosis and the Common Market Entry (UMA) platform to introduce optimistic oracles which are extra correct and fewer susceptible to cost manipulation.
Later the identical month the DeFi protocol unveiled a “Turbo ETH” leveraging product which allowed merchants to make leveraged bets on value will increase.
The newest announcement from Opium was in late Could for a derivatives based mostly product to insure SpaceX launches.
OPIUM value outlook
Opium’s native token of the identical identify has gained 3.4% on the day to succeed in $2.15 on the time of press.
Its value has been steadily trending down since early February, nevertheless, and is presently a painful 90% down from its all-time excessive of $23.
With a circulating provide of 6.7 million tokens, OPIUM has a present market cap of $14.3 million making it a minnow when in comparison with many different DeFi tokens.
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