/1 Innovation is happening on Solana🤩
@friktion_labs is providing unique strategies for DeFi portfolio management.
A 🧵 on Friktion👇
@friktion_labs is providing unique strategies for DeFi portfolio management.
A 🧵 on Friktion👇
/2 Overview
Friktion is described as a DeFi portfolio management.
The platform strategies are called "Volts".
Most of these strategies use options in order to generate high returns.
But how does Volts exactly work?
Friktion is described as a DeFi portfolio management.
The platform strategies are called "Volts".
Most of these strategies use options in order to generate high returns.
But how does Volts exactly work?
/3 Volts are defined as "risk-managed return generation strategies".
Depending on their market sentiment, users can choose a strategy and earn premiums if the price of the underlying asset from the volt stays in a specific price range.
Friktion has 5 products live atm:
Depending on their market sentiment, users can choose a strategy and earn premiums if the price of the underlying asset from the volt stays in a specific price range.
Friktion has 5 products live atm:
/4 Volts
Volt 1 is a covered call strategy.
The deposited funds for this strategy are used for selling call options on a specific asset in exchange for a premium.
e.g. Volt 1 is selling now a $SOL call with a strike price of $39 that expires on September 9th.
Volt 1 is a covered call strategy.
The deposited funds for this strategy are used for selling call options on a specific asset in exchange for a premium.
e.g. Volt 1 is selling now a $SOL call with a strike price of $39 that expires on September 9th.
/5 If $SOL price is <$39 at expiration, the volt 1 depositors will earn a premium.
But if that's not the case, they'll incur a loss.
Volt 2 is a cash-secured put strategy.
This means that the deposited funds are used for selling put options in exchange for a premium.
But if that's not the case, they'll incur a loss.
Volt 2 is a cash-secured put strategy.
This means that the deposited funds are used for selling put options in exchange for a premium.
/6 e.g. Volt 2 is selling now a $SOL put with a strike price of $23 that expires on September 9th.
If $SOL price is <$23 at expiration, the volt 2 strategy depositors will incur a loss.
However, if the $SOL price is above $23 at expiration, they'll earn a premium.
If $SOL price is <$23 at expiration, the volt 2 strategy depositors will incur a loss.
However, if the $SOL price is above $23 at expiration, they'll earn a premium.
/7 Volt 3 is a Crab Strategy.
This strategy is running a delta-neutral strategy and performs well when the market goes sideways.
At this moment, Friktion has only one Crab Strategy for BTC.
This strategy is running a delta-neutral strategy and performs well when the market goes sideways.
At this moment, Friktion has only one Crab Strategy for BTC.
/8 If the price of BTC moves more than ≈12% in one direction in a week, the volt depositors will incur a loss.
Otherwise, they'll get funding payments.
The 12-month yield of volt 3 is 17% atm🤯
Keep in mind though that it isn't risk-free.
Otherwise, they'll get funding payments.
The 12-month yield of volt 3 is 17% atm🤯
Keep in mind though that it isn't risk-free.
/9 Volt 4 is a delta-neutral automated basis trading strategy.
I would say that this one is only for experienced traders.
The strategy is essentially opening a long SOL-PERP while shorting SOL to delta hedge.
It generates profit only when funding rates are positive.
I would say that this one is only for experienced traders.
The strategy is essentially opening a long SOL-PERP while shorting SOL to delta hedge.
It generates profit only when funding rates are positive.
/10 Volt 5: Capital Protection
Volt 5 launched yesterday.
It aims to generate high rewards without putting the deposited capital at risk.
Volt 5 initial capacity is $1M and is available only for those that hold a certain NFT(for the time being).
friktionlabs.medium.com
Volt 5 launched yesterday.
It aims to generate high rewards without putting the deposited capital at risk.
Volt 5 initial capacity is $1M and is available only for those that hold a certain NFT(for the time being).
friktionlabs.medium.com
/11 How does it work?
The funds deposited for this strategy are lent using Tulip, a Solana lending aggregator.
The protocol uses only the interest earned to buy put options.
So this strategy performs well when the price of the volt asset( $SOL) is in a downtrend.
The funds deposited for this strategy are lent using Tulip, a Solana lending aggregator.
The protocol uses only the interest earned to buy put options.
So this strategy performs well when the price of the volt asset( $SOL) is in a downtrend.
/12 Other news
Friktion has recently announced a partnership with @FireblocksHQ, connecting institutional clients to the platform volts.
The team also revealed on discord that those who hold a lighting OG NFT might be eligible for an airdrop👀
docs.friktion.fi
Friktion has recently announced a partnership with @FireblocksHQ, connecting institutional clients to the platform volts.
The team also revealed on discord that those who hold a lighting OG NFT might be eligible for an airdrop👀
docs.friktion.fi
/13 That's it!
With 5 strategies already live that are generating high returns for depositors, Friktion is definitely playing an important role in the DeFi space.
If you found this thread helpful, please leave a like and retweet the 1st tweet. 🤝
With 5 strategies already live that are generating high returns for depositors, Friktion is definitely playing an important role in the DeFi space.
If you found this thread helpful, please leave a like and retweet the 1st tweet. 🤝
A small correction: Volt 4 strategy is profitable when funding rates are negative.
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