Background:
Currently, when it comes to trading crypto derivatives and complex financial products, the offerings available to users are quite limited.
This is especially true when looking at decentralized derivatives platforms. While a handful exist, the volume and offerings arenot significant enough to be advantageous over other centralized alternatives.
For the most part, a users only option is to used products offered by centralized exchanges such as FTX, Binance, and Kucoin.
While a handful of decentralized platforms exist in the space, such as dopex, the volume, depth of liquidity, and scope of offerings are not significant enough to be advantageous over centralized alternatives
We’ve already seen the harm that can be done via CEFI exchanges such as voyager and Celsius, with users funds locked or even worse — permanently lost. Both illustrate the inherent dangers that come when trusting control of your assets to third parties. As is often said, not your keys not your coins. Malpractice, the potential for hacks, and the overall lack of financial privacy are just a few of the disadvantages of centralized platforms, when it comes to crypto trading platforms.
What if instead, there was a non-custodial exchange with the ease of use and features of a centralized exchange that also preserved the key tenets of decentralization and the value it brings — privacy, security, self-custody. A platform that allowed users to trade options, futures, and other types of derivatives against a multitude of assets, without making the sorts of compromises seen in CEXEs. A platform where listing was transparent and not determined by the exchange but by users. Where users could seamlessly trade on different chains, with settlement occurring natively. Where anyone could act as a market maker.
With divvy, there now is.
What is divvy and how does it work?
Divvy is a P2P derivatives exchange where anyone can become a market maker by creating specific trading pools , and then offering custom derivatives that can be traded against them. These can include simple products such as futures, as well as more exotic offerings such as leveraged tokens, options, total -return swaps, and volatility indices
To become a market maker, users would first create a pool by supplying the target assets; this can be a simple pair such as AVAX/USDC or multi-asset pool. Then using the divvy dx builder — intially limited to options and futures- each market maker can create and list the derivatives specific to their trading pool, that can be traded by market participants.
Each market maker is responsible for setting fees on their trading pools as well as determining incentives. This can be thought of as working similarly to sudoswap, an NFT AMM with user supplied pools. Fees can take the form of a premium, as with options, apply as % fee over the course of a trade, such as with futures, or simply be a flat fee, as in the case of swaps or index offerings. Incentives are what MMs use to drive liquidity to their pools. This will take the form of payouts to stakers from fees generated — such as from options underwriting premiums, borrowing fees from leveraged futures, or from liquidations. The exact structure will be up to each MM.
Additional Features :
Divvy will provide a central order-book style trading experience, similar to the experience on centralized exchanges. It will also support advanced charting features, with support for technical indicators as well as on chain metrics.
On top of market orders, Divvy will support limit orders, fill or kill type trades, order chaining, and conditional execution based on user defined indicators.
To earn, users have several options. This includes becoming an LP provider, in exchange for our liquidity-accrual token, DAT, where you’d earn a percentage of all trading fees; staking our governance token DIV; becoming a MM; delegating to MMs; or simply trading.
Another cool feature that sets divvy apart is native settlement. For example, if you use avax for example as collateral to long eth, when you close out the position, you would receive eth on the ethereum network by default, rather than usdc or weth on avalanche. When it comes to trades across chains, settlement occurs natively through anycall’s message passing protocol to communicate position info between chains. But if users don’t prefer native settlement, they will also have the option to receive settlement in the gas token of the chain the trade is made from or cash settled as usdc.
To onboard new users and make the trading experience as conventient as possible, Divvy will offer a fiat onramp via ramp. This will enable non-crypto natives to quickly deposit funds and begin trading, with a similar feel to a cex and without kyc. Fiat offramps are a bit more complicated, but this is an area we’re also actively exploring.
Divvy will have an OTC desk, where trades will be routed directly to counter-parties, avoiding potential market impact and slippage. This will allow efficient execution of block trades from whales and those wishing to shield their transactions.
Divvyy will also have an Affiliate Program. Users will be able to generate and share a unique referral link and earn discounts on trading fees.
Another exciting feature divvy will build out is support for advanced trading bots. Similar to the bots offered by Kucoin, Binance, and other CEXs, this will allow users to create bots that execute custom strategies. Creators of the bots will earn 70% of all fees generated from usage. Initially the rollout of our trading bots will be limited to DCA and Futures Grids for select pairs.
Some other potential CEX-inspired features we’re exploring are a Launchpool program, where users can provide lp stake to earn tokens of new projects as well as a copy trading program where users can copy trades made by other users on the platform in real time.
We’re excited to build out Divvy and its many novel features. If you have a suggestion for potential features not included here, don’t hesitate to reach out to us on discord. We love to hear feedback from the community.
Tokenomics and Protocol Mechanics:
FEES
Any time someone uses leverage and opens a futures position, a borrowing fee will be applied- the same is true for other derivatives offered by mms, such as swaps, options, and volatility indices.
DIV
Initial Supply: 5 Million
Users can purchase our utility token DIV, that can be staked to earn up to 30% of all trading fees globally. It can be compounded or claimed. This is an inflationary token. DIV will be used for governance.
DAT
Supply: N/A
DAT is our liquidity accrual token. It is minted every time someone provides lp, and burned when redeemed for the underlying assets supplied. This will work similar to gmx’s glp token, where the value of DAT is determined by an index of all assets supplied across pools.
Users provide lp to recieve DAT, earning a percentage of all trading fees — these are paid out in combination of the tokens that make up the trading pairs — for example eth, matic, avax, and bnb. Users can mint DAT by supplying single assets.
Governance:
At Divvy, we intend to use a decentralized governance model when it comes to major decisions. We’ll be incorporating governance features to allow divvy to operate independently of the divvy team, enabling stakers of our governance token, DIV, to vote on decisions that impact the future of our platform, with votes weighted based on the number of DIV held. This will be done via snapshot.org.
Security:
Given the complexity of what we are trying to do, Divvy will be getting an audit from Certik before launch. Additionally, our code & all contracts will be published on GitHub for all to inspect, and we will have a responsible disclosure bug-bounty program.
The founders of divvy are doxxed and have experience in defi, having created Lava Financial. Still, we know the space is filled with bad actors that have betrayed the trust of project backers and users. For this reason, prior to our launch, the project will be doing a KYC via Obisidian. Additionally, we’ll have a 4/5 multisig securing all contracts and our lp.
Seed Round and Presale:
Where: https://presale.divvy.gg
We will be conducting a seed round to cover the costs of our audit and kyc and prelaunch marketing, with any remaining funds going towards our LP.
Seed Price: $0.75/DIV, 1 month cliff, with a 6 month linear vest.
Min:$5k
Max:$25k
Presale Price: $2/DIV
Min:N/A
Max: N/A
Soft-Cap: $100k For Each Chain Initially Supported.
Hard-Cap: $500k For Each Chain Initially Supported.
We will be holding a public presale 3–4 days before launch, and all funds raised will be used to bootstrap the initial trading pools on each supported chain. Users will be able to purchase DIV and begin earning immediately. Users who are whitelisted will have priority access and be airdropped 50 DIV at launch.
The following 4 chains will be supported initially, and users can contribute on each with the following assets:
Arbitrum: Contribute ETH or USDC
Avalanche: Contribute AVAX or USDC
Polgyon: Contribute Matic or USDC
BSC: Contribute BNB or USDC
For those who don’t want to participate in presale, but still want the benefit of early access, users will also have the opportunity to farm DAT using single-asset staking, with boosted rates ( initially 80% of fees will go to stakers during the honeymoon phase, but will eventually drop to 30%).
Launch:
We’re aiming to launch within the next 1–2 months, although the exact date is still TBA.
DIV Initial Token Distribution:
The following may be subject to change.
Presale and Private Sale 10%
Team 7.5%
Marketing and Development 5%
Treasury and Incentives Distribution: 60%
Liquidity: 17.5%
Roadmap:
- Launch On Discord and Other Social Channels
- Open up whitelist with on Discord and work on community building.
- Release Site at https://divvy.gg along with litepaper
- Release gitbook docs with a detailed protocol breakdown and timeline
- Audit Contracts
- KYC with Obsidian
- Seed Round & Presale
- Release Dapp with support for futures on abitrum, avalanche, polygon, and bsc. Options and other products to be offered a month after launch, once volume picks up.
- Support for user created trading pools and customizable derivatives.
- Continue to expand the protocol and its features. Focus on marketing and outreach efforts and growing all social channels.
A more detailed roadmap with pricing info and finalized dates will be communicated via Discord and Twitter and shared on our site.
Stay tuned!
