What Is It?

Thetanuts Finance is a cross-chain DeFi structured products protocol on Ethereum and 6 other chains.

About Thetanuts

Thetanuts Finance is a decentralized structured products protocol that allows users to earn yield through various options strategies. Thetanuts Finance currently serves two broad categories of users: Treasury management for DAOs and automated aggregated option strategies for retail investors. Thetanuts’ vaults simplify the process of options trading, making previously complex trading instruments easy for any investors to access, democratizing the ability to monetize volatility in a risk-adjusted manner.


Thetanuts Finance was launched on Ethereum in August 2021. It was founded by a team of programmers, hedge fund managers, and financial analysts who specialize in building crypto financial structured products. It has since expanded to other blockchains such as Avalanche, BSC, Polygon, Fantom, Boba, and Aurora, with US$15M in total value locked (TVL) spanning 10 networks as of 28 July 2022. Thetanuts’ Ethereum Virtual Machine (EVM) compatibility would enable different ecosystems to launch structured products on the platform, allowing a wider variety of options for investors.

Products

For more information regarding the intricacies and opportunities that structured products can bring to the DeFi space, click here to read our Insights piece “DeFi Option Vaults: Options Democratized.”

Vault Features and Characteristics

Every vault in Thetanuts Basic displays the following information, which can guide investors’ decision-making. Investors are advised to understand the following characteristics before depositing into the vaults.

Strategy: Each vault will have its own strategy that will determine under what conditions it is profitable (Covered Call or Put Selling).

Estimated Yield: Each vault will indicate the estimated amount investors will gain if the Epoch ends with the vault being profitable. It is denominated in APY, which is subjected to changes.

Asset Type: The underlying asset that the vault writes the option on.

Point of Profitability: The strike price is the price at which an option may be exercised. A put vault is profitable if the spot asset price expires above the strike, while a call vault is profitable if the spot price expires below the strike. Both instances are also known as expiring out-of-the-money (OTM).

Length of Epoch: The lifecycle of each epoch is stated on the vault. Typically, each Epoch lasts for a week, the lifetime of the option being written.

Current Amount of Deposits: Represents the value of assets currently deposited in the vault.

Max Capacity: Represents the maximum deposits the vault can hold for the Epoch.

Auction Mechanisms

Thetanuts’ vaults sell options on behalf of the vault depositors. Whitelisted participants (Market Makers that have undergone KYC) will make a bid to buy the options. The auction winner will be the designated maker sending the premium into the vault. The vault will then pay out the settlement if the vault expires in-the-money on the expiration date.

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Appendix

  1. Thetanuts Stronghold: https://stronghold.thetanuts.finance/
  2. Thetanuts Basic: https://thetanuts.finance/basic/vaults
  3. Thetanuts Documentation: https://docs.thetanuts.finance/
  4. Thetanuts Treasury: https://thetanutsfinance.medium.com/introducing-thetanuts-approach-in-dao-treasury-management-574543481b54
  5. Stronghold USDC Index: 0x075dA7e9EFEA6813aB0B2680423df75150120d12
  6. Stronghold BTC Index: 0x71e1b632F1dDC20F79dF1472F7a464779588A6D1
  7. Stronghold ETH Index: 0x3ff17B85b77386d8dE77FB9532E6F5A49b66e114

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