Before we start, can you briefly introduce yourself to the community?
For sure! My name is Tomer Menuchin, the head of business development here at CVI. My job is to create partnerships with other projects in the DeFi ecosystem. I have a bachelor’s degree in economics and a background in financial payment companies and I’m really happy to part of the future of finance!
Thanks Tomer, then lets start with my questions..
Could you please tell us what is CVI, and what are some use-cases?
In a nutshell, CVI is the VIX for the crypto space.
The CVI index ranges between 0 and 200, and it tracks the 30-day implied volatility of Bitcoin and Ethereum.
Now, for CVI to be popular and widely adopted, there should be an instrument (system) allowing traders to easily open positions against the index and trade it.
Therefore, as part of the CVI launch, we introduced an innovative and full-scale decentralized ecosystem that includes: The CVI trading platform, Volatility tokens, and the $GOVI token.
Both the platform (cvi.finance) and the volatility tokens allow people to trade the expectations of the market for future volatility. So, trading the CVI Index is a great way to find profitable trading opportunities in the market without having to predict the direction of the price. Traders make a profit on volatile markets, whether the prices are going up or down.
In addition, it can be a great hedge against volatility & impermanent loss, since a long position on the index would increase in value when there is extreme volatility in either direction.
I invite everyone who is interested in reading more about our ecosystem and protocol to visit our Gitbook: docs.cvi.finance!
What inspired the inception of the Crypto Volatility Index, and what is the project trying to achieve?
There are 3 charts that are always on our minds when we think about the future. They show the adoption of the original VIX of the stock market over time. The charts show several years of warning up followed by exponential growth.
In regular stock markets, the VIX is super popular, its ETNs have volumes of several billion per day! Due to the exponential growth that began with ETNs, we strongly believe that the CVI is a massive investment instrument. with the much higher volatility in crypto, there is no doubt in our minds that a VIX of crypto, such as the CVI, will be epic.
Can you explain a bit more about GOVI, your Governance Token?
GOVI token is an ERC-20 token currently tradable in Ethereum mainnet and Polygon (soon also in Arbitrum) and acts as the governance token for the CVI protocol and the platform.
I believe we managed to do one of the fairest launches with the launch of GOVI.
The GOVI token was airdropped to over 3000 people, who claimed it over a period of several months.
In addition, 60% of the distribution is done over time to the platform’s users via liquidity mining.
This also makes a lot of sense in our view, as who is better to control the platform and become its owners than its own users who have a stake in the game.
By staking their GOVI tokens, GOVI stakers earn a share of the fees collected from the platform. In less than a year we reached $1 Million USD equivalent in fees distributed to GOVI stakers and we keep growing!
We heard you are coming out soon with an Impermanent loss protection solotion, can you please explain how it will work?
The CVI is the only protocol that provides this service to users without asking them for their liquidity. The CVI team is very excited to help liquidity providers protect their assets that would otherwise be lost due to impermanent losses. Using our proprietary model, any impermanent loss protection purchased will be reflected as an NFT that represents the coverage value, The appropriate time frame, and the pair selected by the user. Through this, any impermanent loss experienced will be automatically refunded to the user’s wallet for that time duration in a seamless and secure manner.
By using CVI’s impermanent loss protection, users are able to supply liquidity in any, chain, DEX, or platform. The users do not need to stake their LP tokens in order to purchase the CVI impermanent loss protection.
How do you calculate the Impermanent loss protection
We define the dependency between CVI and the expected IL percentage for the next 14, 30, and 60 days as a simple quadratic parabola fitted to the historical data. the effect of the curve can be explained by the following: When the volatility index is low, we can expect stable growth of ETH price, which concludes in high Impermanent Loss. When the volatility index is high, we can expect a plunge in the ETH price, which concludes in a high Impermanent Loss.
Thanks Tomer, it was my last question. Now it is time for users live questions
Based on your whitepaper, 15% of the fees generated and collected by the Platform and ecosystem will be used to fund the GOVI treasury to be used for further growth and development of the CVI ecosystem.
Could you tell me more about the purposes for which this GOVI treasure will be used? Will you share the use case transparently with the community? For example, can this fund be used to compensate for the damages that will occur in the event of a possible cyber attack?
That’s a good question.
85% of the platform fees that were until now distributed to GOVI stakers, will be collected and used to buy GOVI tokens on the market, which in turn will be distributed to the CVI traders, liquidity providers, and GOVI stakers in the form of open positions and staking rewards.
The remaining 15% of the platform fees are going to be sent to the new GOVI treasury, to be used for the CVI ecosystem’s further growth and development, and yes if necessary to compensate for certain users issues
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?
For now only BTC and ETH.. When the volume of options om other assets will rise will add them as well, the index is produced based on a Black-Scholes option pricing model, which computes the implied volatility of cryptocurrency option prices together with analyzing the market’s expectation of future volatility.
By computing a decentralized volatility index (CVI) from cryptocurrency option prices, the new system analyzes the market’s expectation of future volatility. CVI’s method addresses the challenging liquidity environment of this evolving asset class and allows us to extract the needed data to evaluate implied volatilities.
Where I can get the latest updates or more information about the project?
One of our major spotlights is to spread the word about our project. We have a very active Twitter channel which you can follow and keep updated: https://twitter.com/official_CVI
We have a telegram channel where all of our user’s share knowledge with great discussions about volatility: https://t.me/cviofficial
And of course, we manage a discord channel: https://discord.gg/6mAZ7wny
Could you tell us about the marketing strategies of the CVI project? What is your team’s plan so that your project is visible in the crypto space and people come to discover your project?
Our plans include working in many different directions and with many marketing tools. First, some campaigns are running right now. If you’ll go to cryptobriefing you will be able to see a live index on the top banner. Users from Australia and the UK are targeted by our banner campaign on major sites such as investing.com, bitcoin.com, etc.
The idea is to combine strong community and social networks while working with DeFi influencers (which you’ll hear about soon), and banner campaigns.
We signed with, market across, the biggest PR company in the industry to penetrate mass media and be part of the press.
We have many videos and explainers under production right now. And many collaborations to come. The last thing is “WEB 3” marketing, we are working with big companies to perform some WEB 3 campaigns that will attract new users while aiming mostly at traders.
All I said right now is only the tip of the iceberg, if anyone wondered, we have a big marketing budget to perform everything we are planning (which is one of the biggest advantages of being part of COTI).
Security is always the top task of projects. But lately, a lot of cryptocurrencies and blockchain have been appropriated by hackers. What security measures does your project have in place to avoid the possibility of being appropriated by hackers?
That’s a good question,
Our first priority is our user’s safety. That’s why we have done three different audits, you can check it over here: https://docs.cvi.finance/deployed-contracts-and-code-audits/audits
We believe that every product that we release to the market must be audited for security issues.
and actually there’s a new feature that we just finished developing, its called the Theta vault, and its under audit right now💪
It was a pleasure to be here! Hope I answered most of your questions, and hope to see many of you joining our amazing community!!
For all of our updates and to join the conversation, be sure to check out CVI channels:
Telegram (group): https://t.me/cviofficial
Telegram (channel): https://t.me/cvichannel