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Liquidity Products
This section describes all products involving the staking of $REBUS and other Cosmos-based coins. All Staking products invest in staking in different blockchains.
For the users, staking acts similarly to a high-yield savings account, except that the blockchain network operationally benefits from these staking pools.Staking is holding funds in a cryptocurrency wallet to support the security and operations of a blockchain network.
In other words, liquidity products are designed for efficiency, to minimize the time between an order and a purchase event by having multiple sellers ready to satisfy those requests. In DeFi, Liquidity pools are used to invest in the liquidity side of third-party Swap Protocols, like Uniswap.
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Summary
Liquidity Products allow investors to have access to an investment with very low probability of losses in FIAT currency.Liquidity Products are built as Vaults which invest in a third-party DeFi asset.
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Liquidity Product 1 - Single Pair
A single-pair vault allows an investor to invest in a third party Liquidity Deposit (Pool). The investor earns money for each transaction (Swap) within the Pool. Earnings are proportional to the frequency and size of the transactions.
Investment Currency: FIAT
Who invests in such a product?: Those looking for a moderate-to-low risk DeFi investment opportunity. The product is Market NEUTRAL even if affected by the volatility and trend of the swap prices.
Reward: Rewards are based on the number of transactions between a single pair (Swap) using the liquidity in the Pool.
Duration: Perpetual - redemption is allowed at any time at the market price.
Currency Risk (for investors, FIAT based): Medium
Market Risk: Medium
Overall Risk: Medium
Risks: Pair price drops very quickly
Opportunities: Increase in size and frequency of the swaps
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Liquidity Product 2 - Multi-Pair Pools
The Liquidity Product 2 - Multi pairs is based on the same logic of the Product on the Single Pair to which it adds the possibility of investing in a third party Pool with different types of tokens (> 2) and therefore working on more pairs. These can have balanced or unbalanced weights.
Investment Currency: FIAT
Who invests in such a product? Those looking for DeFi opportunities with a higher reward, yet still moderate-to-low risk as compared to single-pair products. The product is Market NEUTRAL even if affected by the volatility and trend of the swap prices.Similar to Swap Product 1 but with more diversification.
Reward: Rewards are based on the number of transactions between multi pairs (Swap) utilizing the liquidity in the Pool.
Duration: Perpetual - redemption is allowed at any time at the market price.
Currency Risk (for investors, FIAT based): Medium
Market Risk: Low
Overall Risk: Medium
Risks: Rapid price drop of one or more pairs.
Opportunities: Scales with size and frequency of swaps.
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Liquidity Product 3 - Multi-Pair Pools with Impermanent Loss Control
The Liquidity Product with impermanent loss control is based on the same logic as the Product on Multi Pairs, but adds the protection from the potential loss due to the market trends using a Put Option.
Investment Currency: FIAT
Who invests in such a product? Those looking for moderate-to-low risk DeFi opportunity. The product is Market NEUTRAL even if affected by the volatility and trend of the swap prices. The impermanent loss is hedged using a PUT Option.
Similar to the Swap Product 2 but with a major control of the impermanent loss.
Reward: Rewards are based on the number of transactions between multi pairs (Swap) using the liquidity in the Pool as well as the price of the pairs themselves.
Duration: Perpetual - redemption is allowed at any time at the market price.
Currency Risk (for investors FIAT based): Medium
Market Risk: Low
Overall Risk: Medium
Risks: Rapid price drop of one or more relevant pairs.
Opportunities: Scales with the size and frequency of the swaps.