Thetanuts Finance Unveils Stronghold Index Vaults to Streamline Options Trading

Cross-chain crypto derivatives platform Thetanuts Finance has launched Stronghold Index Vault – a new options trading product designed to simplify the user experience while supporting opportunities to scour non-inflationary returns and engage in disciplined risk management.

This new addition to Thetanuts’ DeFi Option Vaults (DOV) aims to overcome the existing limitations and hurdles associated with options trading while enabling organic yield generation from option selling, referenced against major digital assets. It will allow users to directly stake their assets in the platform’s wide range of DeFi Option Vaults. According to the Thetanuts team, the Stronghold Index Vault features customized vault indexes built by the team, delivering functionality that aligns similarly to S&P 500’s role in stock trading.

Since its launch in 2021, the Thetanuts Finance team has been continuously implementing new features to lower DeFi’s entry barriers. Through its current selection of vaults, Thetanuts allows users to bypass the many complications of options trading by simply staking their assets into premade vaults.

Lowering Entry Barriers of Options Trading

The newly-introduced Stronghold Index Vault offers similar features, allowing users to overcome entry barriers like analyzing the sheer number of choices, facing liquidity gates, and the likelihood of risk concentration. Through the Stronghold protocol and underlying smart contracts, the assets staked by users are allocated into predefined covered option selling strategies. The base yield generated in the Stronghold Index Vault is the function of option premium payments, unlike existing DeFi protocols whereby users are awarded inflationary tokens.

By doing so, Thetanuts enables users to receive yield-bearing digital assets, which users can use to generate returns by selling options across the curve. At the same time, users can also benefit from diversification since all strike prices and expirations of each Stronghold strategy are designed to maximize risk-adjusted yield.

Additionally, Stronghold Vault overcomes problems users ordinarily face when investing across DeFi vaults. For example, once a user enters a “vault position” on any other protocol, their liquidity is immediately collateralized and can only be withdrawn after the vault expires. However, with Stronghold, users are granted more straightforward investment choices and the freedom to pull their liquidity if and when needed. Meanwhile, the Stronghold Vault also ensures risk management by diversifying users’ assets.

All Stronghold indexes are aggregated within a single “Stronghold token, underpinned by multi-strike, multi-tenor, and multi-asset vaults. This, in turn, protects users from disproportionate draw-downs, especially during market downturns. Furthermore, the protocol’s multi-tenor and multi-strike strategies safeguard users against temporary declines by leveraging mean reversion.

At present, Thetanuts Finance has launched its initial Stronghold Index Vault for USDC, which is now live on Ethereum, Avalanche, and Binance Smart Chains. Thetanuts will add Stronghold indexes for several other major digital assets in the coming months and extend its functionality to Polygon, Fantom, and other prominent blockchains.

To streamline the protocol’s end-user experience, all of Thetanut’s Stronghold products have been aggregated within a unified panel to help users discover assets, interact with indexes, and learn more about the blockchain networks they are deployed upon from a single dashboard. On top of that, Stronghold Vaults will also make it easy for users to generate yield in just one click by allowing users to swap any underlying asset for Stronghold token and vice-versa, thereby enabling them to move in and out of positions as required.