Welcome to Fig
Tokenized hedge fund out of the box
Not all investors are eligible to participate in Fig's yield protocol. Please see Permitted Investors, and Permitted Jurisdictions on who may be eligible to participate in Fig's pools.
Problem
Crypto has a persistent yield problem.
Over the past 10 years, on-chain crypto wealth has grown exponentially. There are estimates of $150+ billion crypto assets looking for yield. These assets have been accumulated over years by crypto natives and will continue to stay on-chain. As wealth grows, generating income on idle assets is top of mind.
Despite various attempts, yield on crypto assets remains low or unsustainable.
Protocols like Ethena have emerged, tokenizing perps funding to meet defi's demand for yield. However, cefi perps market for ETH is close to $15 billion at the moment, which is not enough to satisfy yield on $150 billion of on-chain assets.
That is where Fig comes in.
Overview
Fig is a yield protocol using options.
Through hybrid on and off chain mechanisms, Fig generates yield on crypto assets through delta neutral option selling (writing) by matching on-chain LP collateral with non-toxic option buy flow through traditional exchanges such as CBOE and CME. A spot exposure to BTC proxied via ETF is delta hedged with a short BTC futures and 15-30 delta call, creating a portfolio that:
Collects premium from weekly managed BTC spot ETF option selling
Current contango exhibited in the BTC futures.
The LP positions are tokenized as Fig yield tokens figUSD. Since it represents a net USD value of the collateral assets, it is a fungible token that maybe traded on an automated-market-maker (AMM).
Currently the yield generation strategy is managed by Volatility Research LLC, with steps towards progressive decentralization. See Yield Mechanism for details.
How Can I Use Fig
You can:
Upon approval for KYC and onboarding, deposit USDC or USDT into collateral pool in exchange for Fig yield token and track accrued yield and return.
Mint and burn yield tokens direct via Fig's on-chain protocol, available to KYCed and AML-screened counterparties
Stake yield token, figUSD, and earn points
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