Intro and Background
The Index Coop is the leading builder of onchain structured products and its mission is to make it easy for anyone to access crypto - no matter their financial expertise or wealth. The Index Coop powers index, leverage and yield tokens, such as the DeFi Pulse Index, ETH2x and ETH3x and a High Yield ETH Index, and its tokens live on Ethereum mainnet and L2s.
This new monthly report aims to keep current and prospective token holders informed about the latest Coop news, roadmap, and significant successes and challenges. It includes a financial snapshot, updates from each team and the focus for the next month. Occasionally standalone updates are provided to highlight important items in more detail. E.g. this month’s update has a section on a stablecoin yield index.
We hope you find this report insightful. Feel free to share your thoughts and questions in the comments below.
Thanks,
The Index Coop team
July Close
Financial snapshot (via @anthonyb.eth):
- TVL: $88m*, +$1m MoM
- Monthly net dollar flow (MN$F): +$4.6m
- Monthly revenue/costs: $175k/$205k.
- Runway: 77 months.
- Single counted TVL, not double, triple, or other counts.
News From July
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Protocol updates (via @pblivin0x): PRT Staking contracts were developed and audited for the hyETH PRT rollout. Research and design for a Morpho Leverage Module kicked off too, with the intent of supporting future leverage tokens and leverage yield strategies. Development also began on several supporting smart contracts for the USDC yield product. And finally, Flash Mint functionality is also being redesigned to accommodate a wider range of quote providers and eliminate dependencies on 0x.
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Token product updates (via @allan.g): hyETH PRTs were released, with presale participants able to claim through Merkl and stake their PRTs via the Index Coop App. So far, 17.88% of the PRTs available for depositors in the hyETH presale have been claimed and staked. The second phase of the Arbitrum campaign also kicked off, with $ARB rewards allocated to anyone holding or providing liquidity for hyETH, DPI, and MVI; TVL on Arbitrum is currently about $2m for those products. The leverage suite on Arbitrum was also allocated substantial $ARB rewards, which has helped push TVL past $1.2m and unique wallet count to 180. The RWA index presale did not reach the target threshold by the end of the presale period and therefore will not be launched.
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App product updates (via @caf ): in July, the App Team launched the PRT staking interface, enabled hyETH, DPI and MVI on Arbitrum to be supported and also saw $25m transaction volume via the app. The App Team also started testing a new API for product data, completed a tech debt clean up sprint and scoped upcoming sprints for the Leverage UI V2 and L2 support generally. @caf, Jann and 0xonramp also completed several rounds of interviews and the DAO has now made an offer to a full stack engineer candidate.
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Marketing & Partnerships (via @0x_Dev): the BD crew continued a campaign across CEXs, wallets and fintechs - enabled by the appeal of hyETY, the up-coming USDC yield token (more below) and PRTs as a general incentive for partners - and have a number of large potential conversations open. As deals get signed, where possible they will be communicated publicly. The DAO also launched the second phase of its Arbitrum campaign (with some appealing APYs); concluded the hyETH campaign with Exodus Wallet; announced hyETH’s first rebalance and new composition; saw some whale interest in hyETH; and continued to cite the fee benefit of leverage tokens versus perps.
Introducing the Stablecoin Yield Token
The DAO has been considering building a stablecoin yield index token with Chainlink methodology data for some time, but has been mindful of not having a large enough distribution partner or a number of agreed integrations to help grow the product. A smaller fee (e.g. 50bps) on such a token means it needs billions of TVL to make it strongly revenue generating.
Then, a new pitch to a top stablecoin issuer got traction and the BD team spoke to the Head of DeFi there, who told us such a yield index token is their most requested DeFi product and that the stablecoin issuer believes they have billions of demand to introduce via various internal teams (e.g. BD). Their Head of Defi has used Index Coop products and is a fan. And, in terms of core financial interest, their ventures side is potentially keen to help seed the token to receive PRTs, while the wider org. is interested in growing its stablecoin demand and integrating tokens built on top of it.
The DAO’s product and BD teams have gone many interactions deep with the stablecoin issuer and are working with their product, BD and marketing teams to plan a launch and growth campaign, potentially as early as October. There is quite a bit more scoping to be done, before a firmer timeline will be known. At this time internal BD folks are haircutting their short-term TVL expectations 90%, but even ‘just’ 25-100 million of TVL achieved quickly would enable such a token to have a chance at becoming the token in this category. Chainlink is helping in a similar capacity to the stablecoin issuer, but the stablecoin issuer’s brand and BD machine is significantly larger than the Index Coop’s and Chainlink’s.
Focus For August
- Continue to communicate the $ARB yield rewards on products.
- Continue to communicate the benefits of the Leverage Suite, while planning the next tokens and upgrading the Leverage UI.
- Research and plan new grant applications. E.g. the DAO would love to have $OP incentives on new leverage tokens on Base asap.
- Move the stablecoin yield token project forward, by getting marketing and BD teams across all three partner organisations aligned and working together in the trenches.
Thank you for reading.