Volmex Finance

Volmex labs is not a DAO, it is a private company sharing the mentioned vision of an open, non-custodial decentralized finance ecosystem. They offer their volatility indexes calculations and a series of smart contracts which can be interacted with from their website/app.

It is It implements a similar methodology to the VIX index from traditional finance to calculate implied volatility indexes for Bitcoin and Ethereum. Volatility exposure is achieved through direct and inverse volatility tokens, which can range from a value of 0 to 250 depending on the index calculation. The utility of the tokens is to gain exposure to implied volatility of BTC and ETH. The volatility token price in $ is the same as the volatility index calculation, for example: if the ETH volatility index calculation is 100, the ETHV token would be worth $100. Inverse volatility tokens are worth the inverse value of the range of 0 to 250, so if the value of ETHV tokens is $100, the value of iETHV would be 250–100 = $150.

Volmex is built on top of Ethereum and the Polygon side-chain, with a version on Optimism coming soon, according to their website. Currently 4 tokens are available: BTCV, iBTCV, ETHV, iETHV. For example, holding BTCV is betting that BTC implied volatility will increase. Holding IBTCV is betting that the BTC implied volatility will decrease. A minting mechanism allows to deposit 250 DAI as collateral to mint two tokens: one volatility token and one inverse volatility token. The minting allows the trader to be positioned market neutral. As volatility fluctuates, the share of the 250 DAI that each token is worth, fluctuates. A minimum amount of 25 DAI is needed to mint volatility tokens. Swapping and liquidity providing is achieved using USDC on the pools of Uniswap v3 (Ethereum) or Quickswap (Polygon). The users can redeem volatility tokens to unlock the DAI previously collateralized.