CVI AMA with GEM Collectors — April 12th, 2021

The CVI team was invited to the GEM Collectors Telegram group for a live AMA discussing all about the Crypto Volatility Index.

Crypto_Thai:
Welcome Team CVI to the Gem Collector’s! 🏆🙌
CVI is something totally new from the COTI team. Can you tell us something about this phenomenon?

Efrat:
Sure. Crypto Volatility Index (CVI) is a revolutionary and first-of-its-kind decentralized Crypto Volatility Index for the crypto market. https://www.cvi.finance/

The CVI brings a new set of tools to the DeFi space. Users can:

  • Buy a position in the index if they believe volatility in crypto is about to grow, as a speculation or as a hedge for their portfolio
  • Become a platform liquidity provider to earn fees whether they feel that volatility will decrease or remain the same.
  • Protect their position as liquidity providers on DEXs like Uniswap against impermanent loss (caused by major fluctuations in assets price, regardless of the direction)
  • Earn $GOVI, our DAO token, on all of the above.

Crypto_Thai:
Amazing to hear! What is the main reason that the COTI team started to develop CVI?

Yoni:
Last June, right before “defi summer” we were brainstorming about several DeFi ideas that align with COTI’s mission and CVI was the one we thought that both made the most sense, and could also serve great value to the overall crypto community.

In the regular stock markets, the VIX allows traders direct exposure to the market’s expectations for volatility. With the volatility of crypto markets it seems like a perfect fit.

Crypto_Thai:
Always good to ride the DeFi hype.

Yoni:
In our case with CVI, it feels much more like being very early than riding the hype.
When looking at our segment — DeFi derivatives, it’s just getting started.

Crypto_Thai:
A lot of time have passed so far since the DeFi hype began. Your team managed to develop the whole structure for CVI in this timeframe?

Yoni:
Building a platform for trading volatility is quite a challenging task. Our team has been working many weekends in the last 6 months building the platform. There are many issues to consider — such as gas fees, security capital efficiency, proper incentives for each side of the market.

Crypto_Thai:
How did you cope with these circumstances?

Yoni:
DeFi is always moving fast, so it’s a must to move fast and move smart, we have to always think ahead. One of the things we’re been working on lately is integration with upcoming Ethereum layer2 solutions

Crypto_Thai:
May I ask how many users the platform got right now?

Costa:
A couple of hundreds and the number is rising

Crypto_Thai:
That’s quite a lot for now. Especially when you keep in mind that there is much more to come regarding marketing

Costa:
Yes, we have waited for the ETH platform to be live and audited before the marketing campaign launch. Only now we started to push CVI platform in terms of marketing.

Crypto_Thai:
Taking it step by step…

Yoni:
Only externally, development-wise we’re pushing way ahead.
It feels like we got a chance to build in a space that is still rather empty so we’re early, having a first mover advantage in crypto and defi is great, but to continue to do well we have to constantly build and perfect our platform. Our development pipeline is pretty packed for the coming weeks and months :)

Crypto_Thai:
And which other competitors are out there?

Yoni:
As far as I know, we’re the only platform on the MainNet. Recently, we’ve been seeing a few other projects, but we’ve been live since January and working fast on many new features. We’re happy to see that the space is growing and interest in volatility trading is raising.

In general, our segment can be classified as “DeFi derivatives”. Building in this space, as a developer, is very exciting as you would expect that after the exponential raise in DeFi to $50B the derivatives segment would be huge, but it actually feels like we’re very early on.

Crypto_Thai:
What are the benefits for a LP’r to add Liq on CVI Pools?

Costa:
The are several benefits that the CVI platform offers to the liquidity providers
1. They earn fees paid by traders who open positions on CVI
2. They earn GOVI tokens that give out an opportunity to become part of the protocol’s owners.

Yoni:
Also, we’ve recently increased the rewards for position holders, in order to avoid affecting the natural market balance. The overall logic behind giving rewards, besides obviously incentivizing early adopters — is that we built a decentralized platform. To make it truly decentralized it started off with a big airdrop. Continuing on from there, the rewards would in essence make the platform’s users its owners as time passed by.

Crypto_Thai:
Great! What does Protocols owners mean once you’re in?

Costa:
Holders of $GOVI share platform fees and will vote on matters such as the tradable assets, leverage used, deposit amounts, platform fees, and more.

Crypto_Thai:
When it comes down to further Development. Which plan are on the table for CVI?

Yoni:
As I mentioned, it’s important to look ahead and see where the industry is going. Many users, perhaps excluding whales, are prevented from using defi platforms (and/or have to think twice before any action) due to gas fees. This is all about to change with the upcoming layer2 solutions in Ethereum. So this has been one of focus points in recent weeks.

Layer2 is just one aspect, we have many surprises coming. One thing you can find in our roadmap is “Margin trading”. If there are any developers in the crowd they can take a look at the contract code of our already existing ETH platform. The word “margin” is actually already there in the code.

Yoni:
Since there are so many developments in the pipeline, we’ve also been on a hiring spree to expand the dev team. Been interviewing developers almost daily recently. In that regard — we are also open to recruiting off-site talented developers, so any devs in the crowd — feel free to give us a shout on Discord ;)

Crypto_Thai:
Any other plans to get more people on deck?

Efrat:
As mentioned, it is just the beginning. We have recently added ETH support, Trust Wallet and liquidity mining for $rHEGIC2 holders. We plan to list $GOVI on CEX soon, and there are more surprises ahead :)

Crypto_Thai:
Can you give us a sneakpeak which CEX you’re planning to launch on?

Costa:
I can tell you but I would have to kill you😄

Crypto_Thai:
To secure the user safety. Which steps did the CVI take to secure this?

Yoni:
We’ve had two audits for CVI so far — there will be more for the upcoming new features

Crypto_Thai:
Which audit firms were the lucky ones to scan CVI?

Efrat:
Certik. You can review it here:
https://cvi.finance/files/usdt-audit.pdf
https://cvi.finance/files/eth-audit.pdf

Crypto_Thai:
To summarize every benefit to Hodl the CVI tokens. Can you list us the USP’s? This is also my last question before opening the chat for Community questions.

Yoni:
Regarding GOVI — It’s important to note — No presale was done, no funds were raised, our token was airdropped to 3000+ users for free. It’s also a cashflow-generating token — as GOVI holders receive fees from the platform and are its owners.

Community:
1. As a user could you please tell me what makes your platform better than others? Are any KYC condition will be applied in future ?

2. ETH gas and high fees is high but why your pools are on eth ? why you Choose eth than other pools for staking and liquidity mining to earn $GOVI?

Yoni:
1. As opening a position on cvi would profit from volatility, it’s equivalent to taking a hedge against market volatility — as such, it’s a perfect fit for liquidity providers seeking to hedge against impermanent loss.

2. ETH is the main focal point for DeFi. We are considering other chains but it is the heart of the industry.

Community:
CVI is a crypto volatility index, predicting volatility in BTC and ETH for the upcoming 30 days. Just in BTC and ETH?
How The CVI index calculation mechanism works?

Efrat:
By computing a decentralized volatility index (CVI) from cryptocurrency option prices, the new system analyzes the market’s expectation of future volatility. I invite you to read this article: https://cviofficial.medium.com/cvix-market-fear-index-for-the-crypto-space-74be7634dd5e

Community:
Hello @Yoni_n @EfratBL
Can you use CVI as an analysis of all assets on the blockchain as a liquidity provider? Is this some kind of drop-off purchasing system app?

Yoni:
Yes. As many traders look at the vix as a barometer of the market, it is a great indicator. Our index is comprised of bitcoin & ethereum volatility and works the same way. For example, in the recent volatility spike earlier this year the index went to extreme values of 140 — Right now it’s at ~80 which is a relatively low value in comparison.

Community:
Security, Liquidation and Slashing risks are associated with DeFi protocols. What are CVI countermeasures to deals with such risks??? What are #CVI Risk to Reward ratio, compared to other DeFi protocol platform?????

And how does #CVI voting system works? And what’s the usage of voting system in CVI project???

Yoni:
We have an extensive and robust test suite (you can also have a look at it on our GitHub), actually most of the development work was on the tests to cover any possible scenario.

The voting will allow GOVI holders to decide on upcoming features, parameters and various fees (for example funding fee, position fees etc).

Community:
Hello ma’am I see on the CVI website that tokens $GOVI do not open token sales, so how do users want to have tokens $GOVI? @EfratBl

Efrat:
Via Uniswap or Sushiswap.

Community:
For me, as an investor, it is important to get the most income with the least risk. Tell me, the CVI platform, acting as a financial acceptor in providing a profit-making service, does it conduct market analysis to understand which crypto pair is most profitable and minimize risks? Or you stick to the concept, like most existing DeFi — “Your money is your problem, we are not responsible for anything”.

Yoni:
yes, right now the platform is segmented to different currencies (ETH,USDT). On one hand, this is less capital efficient, on the other — it is less riskier than a platform that involves many different kinds of tokens.

Community:
I’ve been ripped off a few times, rugs, scam exits, etc.
how we, the investors, the Community, believe that this will not be the same,
My only question is whether your contract is public & somewhere to look?

Costa:
CVI platform is developed by COTI team. The team has a great record of development in the crypto space, it is public, the contract is available by the link:
https://etherscan.io/address/0x5005e8Dc0033E78AF80cfc8d10f5163f2FcF0E79

Community:
How about providing liquidity to CVI-USDT-LP.
What are the risks involved? Apart from possibly paying for nothing or Govi not gaining traction. is it possible to lose the whole subject or part of it?

Yoni:
Providing liquidity is equivalent to being short volatility. In case the CVI will raise, lps will lose — but LPs are compensated for the risks by receiving funding fees (and also are rewarded with GOVI). Obviously, it’s better to be on the right side of the market so if you think volatility will raise — it’s better to take a position than to provide liquidity

Community:
What strategies has CVI put in place to ensure it platform is safe and secured against black swan event such as smart contract vulnerabilities? Unfortunately if such happens, Is the platform insured or how can users get their funds back?

Now the market is flooded with many projects, extreme competition. How will CVI ensure your project always get users and stay above your competitors?

Yoni:
Users funds security is always our number one concern above all others. We’ve had 2 audits and going to have a 3rd one.

Regarding the market — Our plan is to move smart and move fast — for this purpose we have a pipeline packed with features and upcoming developments.

Community:
Hello guys, amazing AMA, congrats!!
Can we expect COTI on the CVI this month?

Costa:
Thank you. Regarding COTI going live on CVI, we can’t commit on specific date but its definitely one of our top priorities.

Community:
Decentralization has become more and more important. Is your project truly decentralized? Is there a risk of centralization in the future?

Yoni:
We are partners with Chainlink and have written code (called “External adapter”) being run by Chainlink that pushes the cvi on-chain. We’re also adding and will continue to add more sources for derivatives data

Community:
To support $GOVI value, will CVI carry out a burn or buyback mechanism?
or do you have your own method to increase the scarcity of $GOVI?

Yoni:
There is no need to increase the scarcity of $GOVI — as it is a cashflow generating token unlike many other tokens has actual business sense. As defi matures, projects are becoming valued as real businesses — meaning actual cashflow

Community:
Where will you get liquidity for trading? When adding a new asset for trading, what will technically happen? This is only realistic if your platform has liquidity for the selected pair?

Yoni:
for any new platform added incentives are in place — As could be seen when the eth platform launched, it immediately attracted liquidity until the market reached balance.

Community:
CVI is a crypto volatility index, predicting volatility in BTC and ETH for the upcoming 30 days. Just in BTC and ETH?
How The CVI index calculation mechanism works?

Yoni:
The index is calculated similarly to the VIX — meaning based on the options market.
Right now it’s only BTC,ETH — but when options on other tokens (with enough liquidity) will exist they will be added as well.
You can have a look at the calculation in our whitepaper.

Efrat:
Thank you @Crypto_thai for hosting us! What a great community!

Crypto_Thai:
No problem at all. It was a pleasure hosting this session with you guys. Wish you the best of luck with CVI

Yoni:
Thanks everyone! hope to see you on our telegram/discord and join the govi community ;)

For all of our updates and to join the conversation, be sure to check out CVI channels:

Website: https://cvi.finance

Whitepaper: https://cvi.finance/files/cvi-white-paper.pdf

Twitter: https://twitter.com/official_CVI

Telegram (group): https://t.me/cviofficial

Telegram (channel): https://t.me/cvichannel

Discord: https://discord.gg/48K9EupjqY

CVI is a decentralized volatility index for the crypto space — powered by COTI network

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