COTI, the blockchain protocol built to optimize decentralized payments and digitize any currency, has launched the first decentralized Crypto Volatility Index (CVI). Using USDT, the US dollar-pegged stablecoin, traders can now interact with the live CVI mainnet. Inspired by the stock market's volatility index, CVI brings the 'market fear index' to crypto and gives users the ability to profit from swings in the market in either direction.
Traders can opt to open a position on the index or dedicate funds to provide liquidity. If a user expects high volatility across the index, they can open a position and profit by selling later down the line once the index has risen. Alternatively, a user expecting the market to experience low volatility can provide liquidity to those opening CVI positions and profit from the transaction fees.
A New Opportunity for Traders and Liquidity Providers
Interacting with CVI is simple, with options such as opening a position, providing liquidity or transferring funds from commonly used crypto wallets like MetaMask and Trust Wallet. To begin, all a user needs is USDT, which has to be deposited for a specified amount of time depending on the action they want to take. If a user intends to provide liquidity and collect pooled fees, they will need to deposit USDT for a minimum of 72 hours; if they want to open a position as a trader, they only need to deposit USDT for six hours.
There are also other ways to earn using CVI, such as staking. The release of the CVI mainnet allows users to start staking GOVI, the index's native governance token, to obtain a portion of the network's transaction fees. In addition, liquidity providers can stake their LP tokens for GOVI rewards. As the governance token, GOVI gives its owners the power to contribute and vote on network functions like platform fees, deposit amounts and leverage, which can all have long-term effects on the token's underlying value.
Future Upgrades Will Extend Platform Utility
CVI already offers many features, but has a lot more to come. The platform's launch is a building block towards the goals CVI wants to accomplish in the future, with advances and partnerships being developed to strengthen the ecosystem. CVI has major network upgrades planned, including adding ETH and COTI as deposit tokens, inputting more derivatives market data sources, creating a technical dashboard for advanced traders, supporting margin trading, and introducing an enhanced voting platform. These upgrades will bring more services to the CVI network, paving the way for adoption and further growth.