Read Binance’s latest Launchpool project Aevo in one article

BlockBeats news, on March 6, Binance new currency mining has now launched the 48th phase of project AEVO (AEVO), a decentralized derivatives trading platform. Users can invest BNB and FDUSD into the AEVO mining pool on the Launchpad website after 08:00 on March 8, 2024 (East Eight District time) to obtain AEVO rewards. AEVO can be mined for a total of 5 days. The website is expected to be updated within approximately twenty-four hours of this announcement and before the mining activity opens. Binance will list AEVO (AEVO) at 18:00 on March 13, 2024 (Eastern Eighth District time), and open the AEVO/BTC, AEVO/USDT, AEVO/BNB, AEVO/FDUSD and AEVO/TRY trading markets. Seeds are applicable Label trading rules.

It is reported that before AEVO, Ribbon’s governance token was RBN, and all RBN will be exchanged for AEVO at a ratio of 1:1. After the news was announced, RBN rose above $1, rising more than 36% in 24 hours.



This article was first published on December 8, 2023.

In the early morning of December 8, Solana ecological MEV infrastructure developer Jito Labs opened the JTO airdrop application window. The price of JTO rose rapidly after a brief shock at the opening. , once touching $4.94.

JTO is a hot topic that the encryption community has been paying attention to for the past two days. In this discussion, in addition to projects in the Solana ecosystem, there is also a platform that has also attracted attention. What attracted the attention of the community was that after JTO announced the airdrop inspection website, it quickly launched the derivatives trading protocol Aevo of JTO futures. At the time of writing, JTO futures on Aevo have increased by more than 300% in two days.

One-stop on-chain derivatives trading

Aevo  is a decentralized derivatives exchange that focuses on options trading. The on-chain structured product is owned by Ribbon Finance and uses an order book and margin model. Aevo’s total trading volume currently exceeds $100 million, with current futures open interest exceeding $50 million.

On April 7, 2023, the Aevo mainnet was officially launched. According to DeFiLlama data, Aevo’s TVL currently exceeds US$23 million, of which nearly half of the TVL comes from 11 and 12 moon.

JTO is not Aevo The first wealth password in , popular underlying futures such as PYTH and MEME on Aevo have experienced impressive gains. On November 24, Aevo announced the launch of BLAST futures and stated that the market assumes that the total supply of BLAST is 1 billion. , subsequently, BLAST futures rose nearly 400% within 5 hours.

Aevo’s product ecosystem

Aevo supports options and perpetual futures in a single margin account and other derivatives, allowing users to trade using mainnet USDC and real settlement, users will be able to trade ETH options on the options chain.

Theta Vaults and Earn Vaults

"Theta Vaults" runs an automated European option A selling strategy that generates profits on a weekly basis by writing out-of-the-money options and collecting premiums. Aevo uses the term "Vaults" to reflect the concept of storing user assets in vaults and earning income therein.

Users only need to make a simple deposit, and the vault will automatically start executing specific options strategies. This alleviates much of the gas fee issue to some extent by spreading the gas costs among all vault depositors: instead of 3-4 transactions per user per week, the vault will become a one-time transaction. Thousands of users perform 3-4 transactions per week. This makes the user experience of using Theta Vaults very straightforward and relatively inexpensive.

Theta Vaults also allows users to freely choose when to participate or not participate in weekly strategies through pause and resume functions, giving them the freedom to adjust usage options based on market expectations, without being subject to other restrictions.

"Earn Vaults" are a new series of earnings vaults designed to have risk allocations that are complementary to Theta Vaults. It is an all-weather income product that provides principal protection and enhances income by leveraging exposure to short-term market volatility through a combination of borrowing and exotic options.

Earn Vaults uses a fully funded strategy that allows depositors to take advantage of intraweek Ethereum (ETH) volatility while ensuring their capital is protected. Earn Vaults are a new product line for vaults, so more variants will be coming soon.

Earn vaults structure

Aevo OTC

Aevo OTC is the first to allow users to trade altcoin options at scale on-chain with institutional-grade liquidity providers The platform uses the RFQ system with an on-chain dynamic margin system. Users will be able to trade 13 different cryptocurrencies on weekly, fortnightly and monthly terms. The list of currencies will rotate monthly, depending on the most popular currencies on the market.

Aevo OTC solves the problem of opaque information that users need when purchasing altcoin options. The volatile market for altcoins is often fragmented and opaque, and users who want to purchase altcoin options need to join multiple market makers and over-the-counter trading platforms.

In addition to the cumbersome access process, the few users who successfully access must also send messages to each market maker to request transactions. Users then need to compare each price and trade by following margin rules that largely favor OTC desks. Additionally, margin rules, which often rely on traditional chat channels for communication, are often opaque.

In this scenario, Aevo OTC allows users to trade with institutional-level market makers on the chain.

In addition, according to Aevo OTC's margin system, liquidity providers need to provide 30% of the USDC initial margin, and a dynamically changing margin system to prompt market makers Deposit additional margin based on the mark-to-market of the trade. All security deposits are securely locked on chain.

aeUSD: a mortgage asset with stable income valuation

On December 6, Aevo announced its launch aeUSD, the first crypto-derivatives exchange's first stable-denominated mortgage asset with returns, allows users to earn an annualized return of 4.75% on the exchange's margin while trading with 20x leverage.

Users can convert their USDC to aeUSD for free on Aevo. aeUSD is an ERC-4626 asset based on Aevo L2, which is a combination of USDC and sDAI. aeUSD is an exchange whitelisted collateralized asset with a 100% collateralization factor, allowing users, market makers, and strategies to earn 4.75% APY on exchange margins.

Additionally, aeUSD earnings are generated by depositing into MakerDAO’s Dai Savings Rate (DSR) module and receiving sDAI.

Aevo technical architecture

Aevo is built on a custom L2 based on the OP stack. It achieves high throughput and performance while inheriting the security of Ethereum, and operates using off-chain order books and on-chain settlement.

Off-chain order book

Aevo operates an off-chain order book The order book, pending orders and taker orders are posted and matched. Once the pending order and the taker's order are successfully matched, they are published to Aevo's smart contracts, which are deployed on the L2 aggregation.

Before an order is created and posted to the order book, it is evaluated through an off-chain risk engine. The risk engine checks the margin requirements for the account (standard margin or combined margin) to determine if there is sufficient margin to create the order.

On the chain Settlement

Users' funds and positions are always maintained in the Aevo smart contract on the chain. This means that all fund flows occur within smart contracts, including option settlement, fund payments, and option premium exchange.

L2 Architecture

Aevo’s smart contract is in Aevo Rollup Running on EVM, this is an optimistic summary of Ethereum based on EVM. Transactions are created and settled on smart contracts on Aevo Rollup, which is operated in partnership with Conduit.

Conduit runs a sequencer for Aevo Rollup that publishes batches of transactions to the Ethereum mainnet every 1 hour. In practice, withdrawals from Aevo will take 2-3 hours to be fully confirmed. The confirmation time required to deposit into an Aevo Rollup is the same as a regular Ethereum mainnet transaction, approximately ~10 minutes.

Gas fees for transactions in Aevo Rollup are paid in ETH. Most of the cost goes into putting the call data for this batch of transactions on the Ethereum mainnet. Currently, gas fees for settling transactions are paid by the Aevo exchange, while gas fees for deposits and withdrawals are paid by users.

Liquidation

Since the exchange operates on full margin, liquidation is being evaluated The trader's entire portfolio is considered. The liquidation process is initiated when the risk engine evaluates an account and determines that it violates the requirement of "AB - OO - MM > 0". Where AB = account balance, OO = total value of open orders, MM = maintenance margin for existing positions.

During the liquidation process, traders’ accounts are taken over by the liquidation engine and they are unable to open new orders. After each step of the process, the liquidation engine re-evaluates the account's health. If the account equity is still below the maintenance margin, the liquidation engine will proceed to the next step.

Tokens $AEVO and sAEVO

$AEVO is the native token of Aevo and also the governance Tokens will be launched before January 2024. sAEVO is the pledged version of $AEVO and is non-transferable. Users can obtain sAEVO by staking $AEVO for a fixed period of 3 months at a ratio of 1:1. Users need to re-stake $AEVO every 3 months to regain sAEVO.

Holders of sAEVO can participate in special activities such as commission discounts, reward multipliers, early access to new products, etc. In addition, sAEVO holders have 2x voting rights.

Governance

Ribbon Labs Foundation, also known as Aevo DAO, is an autonomous entity formed by the owners of $AEVO and sAEVO to pursue Aevo's growth and development goals through for-profit and non-profit initiatives.

With the merger of Ribbon and Aevo, all revenue from both platforms will be combined. Currently, Ribbon DOV revenue flows to the Ribbon DAO, while Aevo revenue flows to the Aevo Insurance Fund. In the future, fees from exchanges and vaults will flow into a new wallet managed by the Fiscal and Revenue Management Committee.

Tokenomics

Before $AEVO, Ribbon's governance token is $RBN, which has been widely circulated in the market. 45% of the $RBN previously owned by the DAO will be exchanged for $AEVO at a 1:1 ratio.

Of these assets, 16% of $AEVO will be used as incentives (including airdrop programs), and 9% of $AEVO will be used to support the liquidity of $AEVO on DEX and CEX. An additional 5% is used for community growth, and the remaining 16% is unspecified and reserved for future DAO spending.

Conclusion

Before launching and transforming into Aevo, Ribbon Finance had In May, it completed an $8.75 million Series B round of financing led by Paradigm, and in the following month the locked-up amount exceeded $300 million, a record high.

But after that, its TVL has been difficult to improve. In June 2022, Ribbon Finance suffered a DNS hijacking attack, and there was a malicious interaction request. Although Ribbon Finance said the vulnerability has been fixed and funds on all vault contracts have not been affected. But this news also caused TVL, which was already declining, to be cut in half, falling to less than $80 million.

Ribbon Finance’s TVL fluctuations

Aevo’s launch information was announced on September 8, 2022 , according to public information, the Aevo team comes from companies such as Coinbase, Kraken and Goldman Sachs, as well as institutions such as Stanford University, MIT and Cornell University.

In July this year, the Ribbon Finance community voted to approve the proposal to "merge into Aevo". Subsequently, Aevo announced the launch of Pre-Launch token futures in August to provide perpetual contract trading services for upcoming tokens. The first token to be launched is SEI.

Aevo has been making frequent moves recently, first announcing the launch of Spot Swaps function on December 2. This feature allows users to redeem their collateral directly within the Aevo app. Previously, users had to withdraw assets from Aevo, then redeem them on an external DEX, and then re-deposit into Aevo. On December 6, Aevo announced the launch of aeUSD, a mortgage asset denominated with stable returns, allowing users to earn 4.75% annualized return on the trading platform margin while trading with 20x leverage.

Judging from Ribbon Finance’s TVL, which once exceeded 300 million, Aevo, which currently has only over 20 million TVL, seems to still have a lot of room for development. In the fiercely competitive derivatives trading circuit, whether Aevo can regain the "past glory" of Ribbon Finance remains to be seen by time.