Opeth appears to be one of the defidollar products along with other
Opeth makes stablecoin loans more efficient as the overcollateralization is reduced as Opeth has a price floor unlike let’s say ETH in DAI CDP’s which have no floor and have to be liquidated if the price of ETH tanks.
Opeth for $1280 strike can be used as collateral to take a loan for ~$1280.
this is because Opeth has insurance in form of the Put option that backs it.
Holders of Opeth can create option-backed hedging strategies while also availing liquidation-free loans against Opeth. With sufficient on-chain liquidity in options’ markets, Opeth will help realize these use cases.
Opeth Reduces Downside Protection Cost and also Leveraged ETH Upside + Yield Farming in a way that Stablecoin loans allow committed traders to place options offered by Opeth as collateral to engage in for-profit farming or portfolio diversification strategies meanwhile, One way to protect investment portfolio in a bear market is to buy a put option.
Opeth x Opyn
Opyn is a platform focused on building a flexible protocol that will allow developers to create financial products that will increase the capital efficiency of DeFi. Gamma Protocol’s on-chain options infrastructure allows anyone to make derivative contracts together as structured products for others to consume.
DefiDollar uses Opyn’s protocol to power Opeth.
Advantage of Opeth Finance :
Opeth opens the market to include broader collateral. Even relatively illiquid assets can be used as collateral as they are guaranteed by the chain where the physically settled DeFi option payment comes.
Opeth provide flexible use cases for traders using DeFi options as a party to their investment strategy while it also increases capital efficiency. Traders can borrow up to $999 as collateral for $1,000 as long as they can afford to pay the put option premium.
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