Vortex: Innovative on-chain trading strategies bring you long-term returns
Vortex is a product based on basis trading, providing users with secure, beneficial, and expected returns through DeFi innovation. It will be launched on the mainnet soon.Author: Akropolis
Compiled by: ChainCatcher
As early as the beginning of 2021, when we joined the Yearn ecosystem, we began contributing by creating yield-generating products that do not primarily rely on inflationary emissions as the main source of returns and can potentially generate returns regardless of market conditions.
To achieve this goal, we are closely collaborating with a group of experts with extensive experience in major financial institutions, and we are excited to present our first product, Vortex!
Vortex is an on-chain trading strategy designed to generate long-term, sustainable, and profitable returns while maintaining market neutrality.
"Basis trading" is an arbitrage strategy used in financial markets that exploits the difference between the spot price of a commodity and its future price (the "basis").
As an example of how basis trading works—without going into too much detail—imagine a trader has the opportunity to buy 1 ETH at a price of $3500 and sell a futures contract equivalent to 1 ETH at a price of $4000. The trader can then lock in a profit from the basis, which in this case is $500.
A real-life example can be seen in how BitMEX founder Arthur Hayes used this strategy in the early stages of his cryptocurrency career. He elaborates on his history and methods here, but the key point is:
Vortex operates similarly to these examples but uses DeFi innovations instead of centralized futures markets to generate returns. We will share more details about basis trading and how it works in conjunction with Vortex in future blog posts.
Vortex (v1) does not leverage Bitcoin like Hayes's early strategies, but it does take advantage of basis trading and, due to its construction, benefits the ecosystem by contributing liquidity, which is crucial for all the platforms it integrates with. We will explore the reasons for this in future blog posts.
Maintaining market neutrality is another key advantage of Vortex. This neutrality means that the strategy is:
Vortex has also established numerous risk management procedures to ensure it can withstand all market conditions. These will be detailed closer to the launch, but the focus is on ensuring that Vortex remains safe, beneficial, and meets expectations.
In summary, Vortex will allow our users to:
Vortex v1 is set to launch on the testnet soon, with a mainnet launch scheduled for Q4 of the 21st month. While the testnet will be public, we are also looking for a select group of users to gain early Beta access to the mainnet version.
