GAINS Associates
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GAINS Associates

Polysynth — Telegram AMA — June 23

On Thursday, June 23, we had the pleasure to welcome to our Telegram chat:

Swati and Jeswin

We asked them questions about the development of Polysynth.

Some sentences have been slightly edited for readability but the meaning has been conserved.

Introduction

Q — Ayeley from GAINS: Please introduce yourself. And tell us about your crypto journey.

A — Swati from Polysynth: My name is Swati Agrawal. I head growth and marketing at Polysynth. Prior to Polysynth, I was the CEO/Founder of a stealth mode community-VC DAO which raised $1.5mn+ from a community of 12k+ members.

Prior to starting my web3 journey, I worked in a travel tech company which got acquired as head of growth. Before that, I was briefly working with the CEO of an ed-tech start-up and at McKinsey and Company as a management consultant. I have an educational background in engineering and general management from two topmost ranked institutes in India (the equivalent to MIT/Harvard in the USA).

I’m a degen whose crypto journey started in 2017 when I was writing content for a Swedish company’s newsletter. My interest grew and I invested in Eth, BTC, Tron, ADA, LTC and 15 other coins hence have been around and seen cycles in the crypto market. When things got heated up again in 2021, I got back committed to being in web3 full time. I can be reached here — DMs are open and I’m happy to help with anything! That’s about myself!

About Polysynth

Q — Ayeley from GAINS: What is the Polysynth project about in a few simple sentences?

A — Swati from Polysynth: Put very very simply — Polysynth offers its users a very simple way of earning 20–30% APY in dollar terms,

Behind the scene, Polysynth is offering structured products which take away the effort and complexity of trading options.

Our DOVs (DeFi options vaults) are an easy way for users to deposit their money and make 20–60% APY on the asset deposited (USDC/ETH/BTS) → so the APY is coming from actual $$. Say you deposited $10,000, by the end of the year, you would’ve earned anywhere between $2000–$6000 on this capital which can be withdrawn anytime (no lockups).

We’ve already been live for 2 trading sessions and are making healthy returns on our vaults. here’s what the current APYs look like for this week’s session that expired tomorrow

Pro traders and institutions benefit from such products and make money even in bear markets. We want to democratize access to such products through simple offerings one of which is the DOVs. More can be found out here

Q — Ayeley from GAINS: There’s extra scrutiny in the Defi space after the travails of Luna and Anchor. How do you provide these APYs and still be sustainable?

A — Swati from Polysynth: Excellent question! These APYs are coming from selling options contracts. Not token emissions. Not yield on deposits. Not liquidity rewards. When we sell options, we are essentially interacting with a market maker that buys these options and pays us premiums for them. This premium is the source of the APY.

We are built on Opyn (#1 options trading infra out there) and have partnered with extremely reputed market makers who are buyers of our contracts, we understand that giving rewards from highly leveraged positions and unsustainable token emissions is not the way to go. And hence, no part of the APY is coming from any token distribution or extraneous rewards

These are sustainable because options contracts are bought and sold in the open market-priced acc to market conditions (eg. volatility etc.)

But these are complexities only understood by pro traders. So we abstract away all these jargon and complexities and give our users a black-box way of earning healthy APYs.

Q — Telegram user Shudunki: What are some of the salient benefits of Polysynth’s Option Vaults (POV)? Why should we choose it over other existing options protocols in the industry?

A — Jeswin from Polysynth: Some unique benefits of Polysynth Option Vaults: A wider range of structured products: Polysynth offers a much wider and all-encompassing suite of structured products to earn across all market conditions. Unlike other protocols which expand offerings across asset classes, we are focusing on expanding in terms of strategies.

Expanding offerings in terms of asset classes somewhat defeats the purpose of options, as all crypto assets are highly correlated. On Polysynth in addition to a wider range of products, there will also be different versions of strategies with varying risk-return payoffs based on an investor’s risk appetite. For example, we back-tested our

Covered Call strategy on ETH with the last one-year price data to see that the strategy yielded 35.89% APY with the strike price at Delta 0.1 and yielded 73.69% APY with the strike price at Delta 0.3. The low-risk, medium-return strategy with Delta at 0.1 is live, meanwhile, the medium-risk, high-return strategy with Delta at 0.3 will be unveiled soon.

Tool for DAOs to earn on their treasury: Projects and DAOs now sit on hundreds of millions of dollars worth of assets with limited and low-yielding avenues for deployment. Depositing assets into LP Pools makes the treasury susceptible to impermanence loss, while lending protocols offer minuscule yields. Polysynth Option Vaults can serve as the ideal venue for treasuries to deploy their treasury assets. Since treasuries hold blue-chip assets such as BTC & ETH from a long-term perspective, they can utilize covered calls to maximize yields, and even if the covered call expires in the money, they would still be up significantly in dollar terms. Treasuries can also use cash-covered puts using stablecoins such as USDC to generate additional yield and even if the options expire in the money, they will be able to accumulate BTC and ETH cheaply.

Q — Telegram user Ahmet: Liquidity, Transaction fees, and slippage are always the 3 important factors in financial services. How does ‘ #Polysynth ‘ solve the above problem to attract more users? What innovations will it likely make to improve users’ trading experience?

A — Jeswin from Polysynth: Liquidity Mining Rewards: We are working towards giving investors POL Tokens equivalent to the fees paid. As such, the net fees will become zero, subsidized with POL Tokens. You can learn more about Polysynth and options, especially on this Notion page ( link ). Stake. Earn. Auto-Compound. It’s that simple. Stake Now.

Token

Q — Ayeley from GAINS: What role does the token play in the Polysynth ecosystem?

A — Swati from Polysynth: Our token serves two purposes:

1. Utility

2. governance

As far as utility is concerned, POL tokens will be used to discount the trading fee on DOVs currently and Perps later on. We haven’t yet started thinking about the exact structure of governance, because we want to completely focus on perfecting our product roadmap — but

POL tokens in the future would be used for making crucial governance decisions in the Polysynth foundation. I would love to talk about our product roadmap!

Partnerships

Q — Twitter user @Crypto_Trader43: Great backing and partnerships in the crypto market might bring huge benefits to new projects. At this point, can you tell us about the investors and partners of Polysynth? While building your project, do you take into account the feedback from the community?

A — Swati from Polysynth: Thank you @Crypto_Trader43 for asking! Yes, we also believe having great partners makes it much easier to navigate through the ups and downs without losing sight of what we set out to achieve. We are glad that we have partners such as Sandeep Nailwal & Jaynti Kanani both being Co-Founders of Polygon along with top-tier investors such as Jump Capital, QCP Capital, LedgerPrime, Hashed, DeFi Alliance, Smape, Brevan Hovard and several other prominent partners.

We are committed to building in public and ensuring the community is at the forefront of everything we do. This is evident in 40% of the POL Tokens being designated for the community so that you go on to own what you help build. We constantly give back to our community by way of Referral Rewards, Liquidity Mining Rewards, and several other initiatives. We offer various avenues for our community to co-create with us — we collect feedback and iterate our product basis that feedback. Please join our Discord and Telegram channels to become a part of our community

We have a very active referral system as well! Check out our docs for more information on rewards.

Funding

Q — Ayeley from GAINS: Have you raised funds so far? How are the funds going to be deployed? And are you planning to do any future raises?

A — Swati from Polysynth: Yes, we’re supported by the best. We publicly announced a $1.5mn fundraise last year (link) and have raised a strategic round which we are about to announce in the near future.

Jump Capital, Hashed, Smape, and Sandeep Nailwal are some of our prominent investors. We’re also supported by a host of prominent angels who are KOLs in this space. We are going to deploy funds towards building tech, brand, and marketing chops as we have lined up a slew of product releases in the coming months

Currently, we have a healthy runway and are head down building products. We will do the next fundraising in a couple of months

Competitive Advantage

Q — Ayeley from GAINS: What sets it apart from the competition?

A — Swati from Polysynth: Many things!

1. We’re a DeFi native team that is highly efficient, innovative, and agile (8 members have been ex-founders out of 14)

2. We have partnerships with other protocols on the polygon ecosystem and are continually working to get more partners on board

3. We have a suite of products to generate yield across all market conditions. Our vaults have been making profits even in the bear market.

4. Asset composability => Generate high yield on idle staked assets. We’re enabling support for liquid tokens and yield-bearing tokens such as AAVE tokens which would let users compound their earnings even further.

5. We’re natively built on the Polygon Network which ensures the gas fee remains low.

apart from this, we’re innovating on a slew of other products which are not just for pro traders but are for everyone to use unlike our competitors in the derivatives space

Business Development

Q — Ayeley from GAINS: How far along are you with your roadmap and what should we expect in the next weeks and months?

A — Swati from Polysynth: We’ve been building rigorously for quite some time now

- We launched perpV1 in Mar 2022 which had a cumulative trading volume of $200mn+. We’re currently working on PerpV2 which will be launched later this year with more advanced features like 150x leverage, infinite asset classes

- Our DeFi options vaults are currently live. 2 weekly trading sessions have been completed with profits even in a bear market ~30% APY. In DOVs, we are currently live with the following strategies:

1. Covered call of wEth and wBTC — APYs on this are currently 15% and 14% respectively

2. Cash covered put of wEth and wBTC — APYs on this is currently 69% and 99%

- In the next month (here’s some alpha), we’re going live with Degen vaults which are vaults that give 70–80% APY on a risk-adjusted basis without leverage

We’re looking to launch leveraged vaults in a few weeks after that will let users earn up to 150% APY. We’re also launching treasury management services where protocols and DAOs can earn a healthy yield on their idle treasury assets like ETH, BTC, and USDC

Our roadmap for the last quarter of this year includes PerpV2 as I mentioned. And we’re lined up with synthetic assets for early next year!

In short, ultimately, we want to become a one-stop shop for all on-chain derivatives solutions! 🐸

Q — Twitter user @linhtinhdinh1: Unfortunately, some projects remain halfway because their developers abandon the concept because they cannot achieve the desired capitalization in the long term; how do you plan to make this project sustainable for its development?

A — Swati from Polysynth: This is a sad reality of crypto where opportunities are aplenty. But at Polysynth, we have built a team of highly self-motivated individuals. Our current team size is 14 of which 8 were ex-founders with multiple exits and consist of people who got into crypto as early as 2014.

We at Polysynth are driven by the mission to bring 100 million new users to DeFi over the next decade. Our mission is a testament to our long-term vision which is reflected in the sustainability of the products we build.

A few steps we’re taking to make the project sustainable for our team and users:

1. Building a culture of innovation — our products are innovation-first. We develop with a novelty mindset as we believe most builders in this space are motivated by the excitement of doing something meaningful

2. We are driven by the big picture while being extremely cognizant of market movements. We want to build something that has a source of sustainable value for EVERYONE. usually, projects bootstrapped on the back of fizzy concepts and no real value usually die out. We’re building something users would love interacting with and are offering a completely novel way of interacting with financial products that were previously inaccessible.

When we do not rely on random yields are generating real value, user adoption grows sustainably and the project is able to retain interest from its community of builders and evangelists

Q — Telegram user Queen: Is Polysynth committed to public building and ensuring the community is at the forefront of everything Polysynth does? @Cinnabon13

A — Jeswin from Polysynth: Yes, we have been building in public since day one and our commitment to the community is reflected in how we have set aside 40% of POL Tokens for the community so that you go to own what you help build.

You can earn POL Tokens by way of Refer & Earn: here

Apart from that, there are DOV Liquidity Mining rewards and several other programs.

Jeswin, thanks for coming into our community, and taking the time to answer our questions. Thanks too to Swati for being with us since the beginning and taking us through this amazing project. Do you have any final words for us? — Ayeley Commodore-Mensah from GAINS

Pretty much covered everything. Looking forward to seeing the GAINS Community gaining from Polysynth Option Vaults.

Join our Discord | Telegram to stay updated on the latest from the Polysynth Team. — Jeswin from Polysynth

One last thing! Here is a complete list to our socials:

Website | Blog | Option Vaults| Twitter | Discord | Telegram. Sign up and check it out. We’ve made a doc for easy reference for everyone — here

— Swati from Polysynth

GAINS Associates is the World’s First Decentralized VC, allowing anyone that holds $GAINS to invest in the crypto unicorns of tomorrow. With over 3 years of experience and several ultra-high return deals, we are removing the barriers of entry to investing and changing the world, one deal at a time.

GAINS stands for Group Action Is Never Small, embodying the collaborative spirit that is the essence of blockchain and decentralization.

In addition, GAINS provides daily news, articles, video interviews as well as fun & educational events.

Website | Telegram ANN | Telegram Group | Discord | Twitter | YouTube

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