Decentralized finance (DeFi) recently topped $100 Billion in total value locked (TVL), which has restarted a familiar conversation regarding volatility in this space, and how best to track it.
What’s new this time around is the introduction of the ability of DeFi traders to capitalize on volatility in the same capacity that traders on Wall Street do.
Trading volatility in crypto
Crypto markets are notoriously volatile, with prices of even large-caps like Bitcoin falling 20-25% in a few hours (mid-cap altcoins even fall by 50% some days). Such volatility makes it a traders’ playground, but for those looking to bet on additional aspects of the market rather than just prices, a volatility instrument plays a key role—or even helps hedge—a strategy.
Volatility measures are incredibly important for utility tokens, as it’s one of the best ways to assess and hedge risk for most DeFi protocols. It is straightforward to measure volatility from cryptocurrency trade data using conventio
Źródło: https://cryptoslate.com/this-new-protocol-allows-crypto-traders-to-capture-defi-volatility/
