CAI is the benchmark index for investors looking to get exposure to the Avalanche ecosystem. It is made up of the native token (AVAX) and the major apps in the industry. Degis protects CAI Price Protection, as the Avalanche’s native protection procedure.

Degis Price Protection model

Price Protection is Degis’ next-generation token price protection in this quickly changing crypto environment. Price Protection employs tokens to represent freely tradeable protections. Otherwise, the author of the protection token may recover the staked collateral.

In the protection time, users may choose to be a creator, buyer/seller, or provider depending on their knowledge and projection of the token price. Creators may stake stablecoin to mint protection tokens and keep or sell them in AMM. Providers may deposit token pairings into the swap pool and mine and harvest LP tokens.

How to use Price Protection?

Suppose CAI protection will be available on September 28th.

Using their default time period, the protection will expire on Oct 15th, 2022.

Basic Information:

Type: CAI Protection

Trigger Price: $90 (assume)

Expiry Date: 2022–10–15

Think about it…

If you spend $900 buying 10 CAI at the price of $90 and use it to provide liquidity.

If the price on 2022–10–15 is higher than the original price ($90), you can earn from both price benefit and LP mining rewards, which is the best situation.

But what if the price of CAI is lower than $90 on that day? You may not necessarily make money from this operation…

Time period of Price Protection

There are 3 periods in one batch of the Price Protection. The first day is the deposit period when protection tokens are minted by the deposition of stablecoins, and the initial price of the protection token will be settled at the end. Then during the trading period, there are 14 days for users to conduct a series of actions (like create/redeem protection tokens, buy/sell protection tokens in the swap pool, provide/withdraw liquidity, etc.), users can also harvest juicy mining rewards in this period. The last 3 days before the expiry date is called the locking period, in which only liquidity providers can provide/withdraw their position in liquidity pools.

About Degis:

The next-generation all-in-one protection protocol, the first on Avalanche. They offer exhaustive protection to users and traders, offer a decentralized protection market and will ultimately bring scalable risk management to the crypto world.  etc.

Website | Twitter

About Colony

Colony deploys capital within Avalanche on early stages projects, provides liquidity to DeFi protocols, validates networks through stacking capabilities and will maintain an Index on top Avalanche projects

Website | Twitter

SOURCE:

https://degis.medium.com/degis-will-protect-cai-in-price-protection-e687c9dc3a6d

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