Drink in the elixir, enter the ancestral trance and join the circle of wisdom with your prediction.
The system is simple, can we employ the forecasting powers of our collective to determine how the best NFT Solana projects will fare? Can the whole Apaches tribe profit, not only from when projects appreciate, but when projects also depreciate? That’s exactly what the Circle of Wisdom is about.
Apaches is the first futures market for NFT collections floor, powered by our utility token, $MEZCAL.
TL;DR
When an Apache believes that a collection is going to go up or down in price, he or she can open a bullish or bearish position. For every $SOL the collection goes up or down, so will the amount in the user’s $MEZCAL balance go up or down, multiplied by 10 (our contract unit), also multiplied by a number of contracts (amount, or Wisdom Multiplier). This will lead to big $MEZCAL profits… or losses.
Mechanics
Let us say we love a new NFT Solana collection called AMAZING_SOL_TRIBE. We’ve been following it since its inception and we’ve identified good potential for appreciation.
We’re so confident that we decide to spend 1 $MEZCAL to make a prediction that its floor price will raise soon. Under standard conditions, the Shaman Bot will evaluate our forecast continuously by applying the following formula:
REWARDS ($MEZCAL) = DIFFERENCE(original AMAZING_SOL_TRIBE floor price, current AMAZING_SOL_TRIBE floor price)*10
If, indeed, the price grows, the Shaman Bot will award us the difference in $MEZCAL, multiplied by 10. If, however, it went down, the ShamanBot will take away the difference from our wallet, also multiplied by 10. So, be careful!
Like any forecast, we can predict that it will grow (bullish), but also we might predict that it actually goes down (bearish). It’s up to you and your insight to decide which way you want to support.
Multiplier
But there is an added twist. Our Apaches are steep in wisdom so they might want to apply a quantity multiplier to their prediction, this is what we’ve called the ‘Wisdom Amplifier’. So if I truly believe in AMAZING_SOL_TRIBE, I might want to spice it up with some more $MEZCAL and increase the quantity:
REWARDS ($MEZCAL) = DIFFERENCE(original AMAZING_SOL_TRIBE floor price, current AMAZING_SOL_TRIBE floor price) * 10 * WISDOM_AMPLIFIER
As before, if my prediction is that the floor will go up, and it does, the Shaman Bot will reward us with the difference * 10 * WISDOM_AMPLIFIER. Nevertheless, the same is true if our insight isn’t that good. If it goes down, the Shaman Bot will take away the difference * 10 * WISDOM_AMPLIFIER.
It’s time to sharpen your senses, keep an eye on other Solana tribes, and show the community how wise are you!
Initial margin (blocked $MEZCAL)
For each position to be opened, it will be necessary to block a part in $MEZCAL. Currently, the amount of MEZCAL to be blocked for each position is the floor of the collection divided by 10.
Working Example
Let’s imagine that an Apache has a balance of 101 $MEZCAL. He or she believes that the DeGods collection floor, currently at 300 SOL, is going to go down, and decides to open a Bearish position.
The Apache pays 1 $MEZCAL to open the position, leaving him or her with 100 $MEZCAL left on the balance sheet. For a collection with a floor of 300, the margin required for each contract is 30.
The Apache decides to open the position with 2 contracts, so the blocked $MEZCAL would be 30 x 2 = 60. And he would have another 40 $MEZCAL available to open new positions in other collections:
Total balance: 100
Blocked: 60
Available: 40
P&L: 0
If DeGods floor drops 2 SOL, to 298, as it is a Bearish position, the profit would be 2 x 10 x 2 = 40:
Total balance: 140
Blocked: 60
Available: 80
P&L: +40
Then, DeGods floor goes up to 301, the total profit would be -1 x 10 x 2 = -20:
Total balance: 80
Blocked: 60
Available: 20
P&L: -20
Then, DeGods floor goes up 2 more SOL, to 303, the total profit would be -3 x 10 x 2 = -60:
Total balance: 40
Blocked: 60
Available: 0
P&L: -20
As it is not possible to have an available of 0 and be in losses, it would be necessary to close contracts until there is enough $MEZCAL to cover the margin. So the system would close 1 contract and the user’s balance would be:
Total balance: 40
Blocked: 30
Available: 10
P&L: 0
$MEZCAL is the most valuable element of the Apache ecosystem… So be careful how many contracts you open! The Wisdom Multiplier is a very powerful tool to earn a lot… but also to lose it.
