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Credefi Employs NFT Technology to Create an Advanced Derivative Instrument Into the Crypto Space

2022-01-05   |   by Carl Cohen   |   2101

As we have previously stated, Credefi aims to bridge the gap between the crypto world and the traditional finance sector. And once again we are at it.
  • P1LP — 10 tokens
  • P5LP — 5 tokens
  • D456LP — 200 tokens
  • D678LP — 100 tokens
  • The number of tokens he wants to commit. For example:
  • P1LP — 10 tokens
  • P5LP — 0 tokens
  • D456LP — 100 tokens
  • D678LP — 100 tokens
  • The strike date — after 3 months
  • Strike date after 3 months
  • Discounted future price of 8 000 USDT
  • If the current value of the Underlying NDS tokens is > 8000.
  • The NDS is expired
  • Bob gets all of his underlying tokens back
  • Other holders of Bob’s NDS get nothing
  • If the current value of Underlying NDS tokens is < 8000.
  • NDS fraction holders become the owners of the underlying tokens
  • Since Bob decided to keep 300 of the NDS fractions for himself, he can get back:
  • P1LP — 10 * 0.3 = 3 tokens
  • P5LP — 0 tokens
  • D456LP — 100 * 0.3 = 30 tokens
  • D678LP — 100 * 0.3 = 30 tokens
  • Bob still has his other tokens which were not part of the NDS
  • Bob gets back his tokens, which are worth 10 000 (presumably)
  • Bob got 5 000 USD from the sale of the NDS
  • Bob got his normal interest rate for the period.
  • If we assume that the NDS duration was 6 months, then Bob realised an APY of (1 + 4000/10000)² — 1 = 125% APY, BEFORE standard interest and CREDI rewards
  • Bob still has 30% of his tokens. If we assume that the NDS is worth around 6 000 USD, then the value of those tokens is 1 800 USD
  • Bob got 5 000 USD from the sale of the NDS
  • Bob got his normal interest rate for the period.
  • Bob effectively hedged his position and reduced his loss from 4 000 USD to 3 200 USD, or a 20% reduction.
  • Loan 1 for 1 000 000 USD
  • Loan 2 for 2 500 000 USD
  • Loan 3 for 1 500 000 USD

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