When it comes to crypto, there is nothing but a fine line between value investing and speculating. Especially like the market situation we are in now where random projects are pumping or dumping fueled by hypes & trends.
Not all of us have the time or the expertise to #DYOR on every new project. But we can’t also just go around parking our money in the random 100x meme token your favorite social media influencer shilled to you. That would be a disaster.
We the people are in need of a solid product, that helps users invest in good projects in this space and do that so, in a systemic and user-friendly manner. Such products are brought to you by Index Coop — The #1 Crypto Index Fund Manager.
what is an index fund?
Index funds are financial instruments that track the performance of an index/bucket of assets rather than a single asset. The advantage of investing in a bucket of assets rather than a few selective assets is healthy diversification. “don’t put all your eggs in one basket”, they say.
Index funds come with a huge potential to risk aversion. even if few assets in the basket perform badly or even go under, the investor of the index will relatively be in a safer position as his gains from other assets in the basket balanced the losses from underperforming assets.
Even though it diminishes returns to an extent, we can’t argue against the fact that such projects are even more necessary in the wild west crypto market than in traditional markets, Because in crypto there are hundreds of choices, dramatic price swings, and a market that never sleeps.
What is index coop?
Index Coop builds simple yet powerful index products to help you access crypto investment themes.
Their mission is to create a better way for people to join the crypto revolution. They are trying to do what traditional index funds helped retails investors to achieve, to grow their wealth in a stable way.
Index Coop has theme-based crypto index products, so the user has more freedom in choosing which type of asset their investment will be tracking, given that there are too many assets in crypto and it is hard to put them in one category.
Let me shill you some of their products!
Defi Pulse Index (DPI)
The Defi pulse index (DPI) tracks the performance of the top Defi project’s tokens. A single DPI token tracks the performance of all these Defi projects based on the weightage given to each project. The weightage depends on the circulating supply of each token.
Currently, these are tokens tracked under DPI.
The tracked assets are well picked that they have to have some predefined characteristics for them to be tracked in Defi Pulse Index.
- The Token must be an ERC-20 Standard.
- It should be related to Dapps listed on Defi Pulse.
- The token must be decentralized enough so that it won’t be defined as a security.
- Wrapped tokens, Tokenized derivatives, and Synthetic assets will not be considered for the index
- Along with that the projects circulating supply, potential use cases, adoption, demand, age, and such metrics are verified before adding it to DPI.
DPI is an amazing choice for people who wants to get exposure to the growth potential that Defi applications create. Imagine buying into DPI before the Defi Summer of 2020.
Metaverse Index (MVI)
The Metaverse Index (MVI) tracks the performance of top metaverse projects. A single MVI token tracks the performance of all these Metaverse projects based on the weightage given to each project. Here weightage is determined by the market cap and liquidity of the token.
Currently, these are tokens tracked under MVI.
The tracked assets are well picked that they have to have some predefined characteristics for them to be tracked in Metaverse Index.
- The token must be an ERC-20 Standard.
- The project should be listed in coingecko in any of these categories — Non-Fungible Tokens, Entertainment, Virtual Reality, Augmented Reality, and Music.
- The protocol must have at least 3 months history of operation and the token must have at least 3 months of price and liquidity history (must also have considerable Ethereum DEX liquidity).
- Along with that, the project’s security audit will be considered before including it into MVI.
MVI is the go-to product to get exposure to the growth potential created by the new metaverse craze in the market (MVI did a 10x run from the lowest point this year, after the metaverse craze started by Facebook rebranding itself Meta).
Bankless BED Index
Bankless BED Index took a unique approach to create an index product that is soo wholesome covering the three major themes of crypto — Store of value, Programmable money & Decentralized finance with equal weightage.
A single BED token tracked the performance of Wrapper Bitcoin, **Wrapped Ether & Defi pulse index (DPI) **with equal weightage.
For a project to be included in BED,
- It must have a market cap above $25B.
- the protocol must be widely used either as a network or as a smart contract platform.
- the asset must have sufficient liquidity for initial inclusion and further rebalances.
ETH 2x Flexible Leverage Index & BTC 2x Flexible Leverage Index
These are cool index products that track the performance of the 2x leveraged positions of those respective assets. This is extremely useful for leverage traders who take collateralized loans to leverage their positions.
When the market faces sudden negative volatility, the chances of the collateralized loans getting liquidated to cover the position are high. Using ETH 2x-FLI or BTC 2x-FLI, the users don’t have to manage or monitor their leveraged position, any action required to avoid liquidation like rebalancing collateral will be done by index managers. Users can just get the benefits of a 2x leverage position at ease.
It internally uses cETH as collateral to get a USDC loan and uses the USDC to buy more ETH. the debt & collateral is accessed through compound finance.
Note: ETH 2x-FLI is also available in polygon, we don't have to worry about high ETH Gas fees while buying it.
Data Economy Index (DATA)
Data Economy Index (DATA) tracks the performance of data-oriented new-age blockchain projects. This is another avenue in which blockchain is trying to revolutionize the existing system.
Currently, all our data is controlled by the big tech monopolies whose track records call for attention to its ethical standards on how it uses user data.
Currently, these are the tokens tracked under DATA,
For a project to be included in DATA,
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It must be a Data-based protocol & an ERC-20 standard token.
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The protocol must have organic user activity, on-chain transaction volume and, considerable Total Value Locked (TVL).
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The market cap must be above $100M and must have sufficient liquidity in DEXes.
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The minimum age of existence of protocol & the individual security audits will also be evaluated.
Now that we’ve seen the index coop’s produces, let's see how to buy them in 4 easy steps:
Step 1: go to Uniswap ➡️ select Ethereum network ➡️connect your wallet
Step 2: select a token with which you want to buy DPI (or any other index product) here I’ve chosen ETH. then, click on select a token and search for “DPI”
If the token is not available in the search, use these contract addresses to search and import them (source: CoinMarketCap).
DPI: 0x1494ca1f11d487c2bbe4543e90080aeba4ba3c2b
MVI: 0x72e364f2abdc788b7e918bc238b21f109cd634d7
BED: 0x2af1df3ab0ab157e1e2ad8f88a7d04fbea0c7dc6
DATA: 0x33d63ba1e57e54779f7ddaeaa7109349344cf5f1
ETH 2x-FLI: 0xaa6e8127831c9de45ae56bb1b0d4d4da6e5665bd
ETH 2x-FLI (Polygon): 0x3Ad707dA309f3845cd602059901E39C4dcd66473
BTC 2x-FLI: 0x0b498ff89709d3838a063f1dfa463091f9801c2b
Step 3: Enter the quantity of token to swap ➡️ Review the conversion rate and gas fee ➡️ Hit Swap & approve the transaction (make sure that you have enough ETH in the wallet to cover the gas fee)
Step 4: Sit back and watch your investment grow steadily.
Disclaimer: The intent of this content is purely educational #NFA. It is always a good practice to Do Your Own Research #DYOR before making any financial decisions.
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