The most important advice we gave ourselves was what users actually care about is their investing and trading experience, not what chain they are on or what kind of tech has gone behind building the product.

MaticNews x Polysynth AMA Recap and Transcript

MaticNews: Another AMA based on a Polygon project after the big success of past ones! Let’s start with you and your team's introduction! What are your past experiences and roles? How many members are currently working on Polysynth?
PolySynth: About myself: My name is Swati Agrawal. I head growth and marketing at Polysynth. Before Polysynth, I was the CEO/Founder of a stealth mode community-VC DAO which raised $1.5mn+ from a community of 12k+ members. Before starting my web3 journey, I worked in a travel tech company which got acquired as head of growth. Before that, I worked briefly with the CEO of an ed-tech start-up and at McKinsey & Company as a management consultant. I have an educational background in engineering and general management from two topmost ranked institutes in India (the equivalent of MIT/Harvard in the USA).

I'm a degen whose crypto journey started in 2017 when I wrote content for a Swedish company's newsletter. My interest grew, and I invested in ETH, BTC, Tron, ADA, LTC, and 15 other coins. When things heated up again in 2021, I returned fully committed to web3 full time in 2021.
About the team: The team consists of 14 members out of which 8 have been ex founders! Our CEO has had 4 exits in the past and is serial entrepreneur, who has had great feathers to his cap - Forbes 30u30 and YC. The co founders have been into blockchain space since 6+ years now!
MaticNews: Out of curiosity, why did you choose this name? Is there any background story?
PolySynth: Polysynth was originally a Synthetics trading platform (psss) on Polygon network - and hence polysynth. Gradually, we moved over to perps and now we're fully live with DOVs.
POLY (gon) - SYNTH (etics)
MaticNews: What exactly is PolySynth? Can you tell us briefly?
PolySynth: Polysynth offers a simple way for users to earn yields via depositing assets into structured products, which removes the trading efforts and complexity.
Quite simply, earning off of selling options is complicated in the web2 world but ppl make 15-40% returns annually doing it! We take away all the complexity and give a simple to use deposit product

Our DOVs (DeFi options vaults) are easy for users to deposit their money and make 20-30% APY on the deposited assets (USDC/ETH/BTC). The APY is paid in the deposited assets - ETH, BTC, or USDC, as the case may be. Say you deposited $10,000; by the end of the year, you would earn anywhere between $2000-3000 on this capital.
https://www.youtube.com/watch?v=lVF58jzirfc&ab_channel=Polysynth - we've created a video series for users to follow along - these are simple, fun 2 min tutorials on how you can use the platform!

Alpha: We've launched Leveraged Options Vaults, where you can leverage your collateral by up to 5X to turbocharge your returns.

You can check the current yields at https://bit.ly/3Rvfo6m

MaticNews: On what chains is PolySynth currently available? Are there any plans to expand in new ones?
PolySynth: We are currently available on Ethereum and Polygon and support major bridging solutions like Hyphen to allow users to bridge assets across all EVM L1 and L2 chains. If it seems rational, we may expand to Solana and other EVM-compatible chains in future.
MaticNews: Why should people use Polysynth? Can you tell us what makes your project different from other competitors?
PolySynth: Well, a couple of things:

  1. DeFi native team with experience of members in crypto dating back to 2014, and 8 out of the total 14 team members have been ex-founders
  2. Partnerships with other top protocols on the Polygon and Ethereum ecosystem
    A suite of products to generate yield across all market conditions
  3. Asset composability: Generate high yield on LP Tokens and Yield Bearing Tokens. We're working behind the scenes to add support for Lido stTokens and AAVE Tokens, which would let users compound their earnings even further
  4. Asset composability: Generate high yield on LP Tokens and Yield Bearing Tokens. We're working behind the scenes to add support for Lido stTokens and AAVE Tokens, which would let users compound their earnings even further

MaticNews: Key question: what are the Synthetic tokens?
PolySynth: As the name suggests, a synthetic asset is an artificial asset. This means that the term refers to a group of assets with the same value as another asset. For example, if you were to group a few assets so that their price trajectory would mirror that of the US$ identically, you would create a synthetic US$.
In the world of DeFi, synthetic assets are unique as they can be used to give users access to a variety of different assets without them ever having to hold the underlying asset at all. For example, this underlying asset could be anything from currencies like the US dollar or the Indian Rupee, commodities like gold or silver, stocks like GME or AAPL, indexes like the S&P 500 and the NASDAQ30, or any other kind of digital asset.
We just ended our weekly expiries and results are out soon! ALL our vaults have expired out of the money which means we have continued our streak of being profitable for 8 straight weeks now!! Check out the APYs on the website!
MaticNews: Talking about your core, will you tell more about what is the use case of your native token POL ?
PolySynth: POL token is a utility and governance token that allows the Polysynth Community to truly own and govern the Polysynth protocol.

As such, holders of POL tokens accrue voting rights proportional to their holdings. By enabling shared control, POL aligns incentives between the Team, Community, Traders, Investors and Partners of the Polysynth ecosystem. Going forward, we will also enable fee rebates based proportionately to your POL Token holdings.
MaticNews: You have built a dedicated POL rewards dashboard on your website. Can you tell us about the details of these rewards?
PolySynth: We believe people who help build and grow Polysynth should be rewarded by getting to own a piece of what they help build. We do it by rewarding our community with POL Tokens. The POL Tokens, apart from being a governance token, also open up additional privileges within Polysynth going forward, such as a discount on fees. This way, we ensure that the incentives between the community and the project are always aligned, which is the hallmark of any successful project. Investors and traders can earn POL Tokens by staking funds in our option vaults or referring their friends to Polysynth.
MaticNews: You have recently unveiled Treasury Management Solutions for DAO treasuries. Tell us more about it and what problem it solves.
PolySynth: DAO treasuries have grown significantly over the past two years (check AAVE, Balancer, Uniswap!).

Even after the recent market drawdown, the top 50 treasuries (fully vested) are worth well over $8 billion. However, for most DAOs, native tokens represent an overwhelmingly large value in their treasury. Though it’s well-known that DAOs need to diversify their treasury, the options available are far from optimal.
So, we at Polysynth have developed strategies that enable DAO treasuries to achieve a) Treasury Diversification and b) Downward Price Protection without selling their native tokens. This could unlock a new chapter for DAOs as we take of earning yields on native tokens and protecting the treasury’s dollar value using structured products.
You can learn more about it here: https://blog.polysynth.com/best-defi-treasury-management-solution-535c31912c70
MaticNews: What is one product you are building that you are super excited about?
PolySynth: I am extremely excited about Leveraged Options Vaults, which will be a first in the industry. We backtested our ETH Covered Call strategy using last year's data and what it shows is that an investor could have earned 376.84% APY using our leveraged options vaults at 5X leverage. Such APYs are unheard of and could completely transform our thinking about investing.

Learn more about leveraged options vaults: https://blog.polysynth.com/strongest-strategy-to-earn-yields-in-defi-leveraged-options-vaults-4e335997aa74
I am also really excited about offering asset composability as we are working on adding support for LP Tokens and Yield Bearing Tokens in our DOVs which could capital efficiency in DeFi whole another level.
MaticNews: Next is tokenomics! What is yours and why did you choose it?
PolySynth: We have set aside the largest allocation of POL Tokens, which is 40% for the community so that you go on to own what you help build. Rest is kept aside for the Polysynth foundation, founding team, team performance incentives, investors and strategic partners. The allocations can be seen on the docs on the website https://polysynth.com
MaticNews: Are there any fees while using your protocol? How they sustain future development?
PolySynth: The fee structure consists of a 2% management fee and a 10% performance fee. If the weekly strategy is profitable, the weekly performance fee is charged on the premiums earned. If the weekly strategy is unprofitable, performance is not charged. However, the management fee will always be charged irrespective of the profitability of the weekly strategy. Fees collected are retained in the Polysynth treasury, ensuring the future development and sustainability of the protocol.
MaticNews: Talking about the security side, the clichè question that we ask in all AMAs:  are there any audits or KYC done?
PolySynth: Our codebase is a fork of audited contracts. We have applied for audits of our DOVs with top blockchain security firms, but as you know, they have a long lead time. We will make an announcement on Twitter and our community channels as soon as we complete these audits. Stay tuned.
MaticNews: What awaits us for Polysynth in the future? What are your plans and roadmap?
PolySynth: We launched V1 of Perpetual Futures in March 2022, which now has a cumulative trading volume of $200mn+. We're currently working on Perp V2, which will be launched later this year with more advanced features like 150X leverage, infinite asset classes, multi-asset collateral support and limit & stop-loss order types.

Our DeFi Option Vaults are currently live. 8 weekly trading sessions have been completed earning high APYs even in the ongoing bear market. In DOVs, the strategies for 4-week average APYs are as follows:

WETH and WBTC Covered Call - 17.89% and 18.66%, respectively
ETH and BTC Cash-Covered Put - 30.9% and 26.98%, respectively

In the next month (here's some alpha), we're going live with leveraged options vaults that will let users earn up to 350%+ APY.

Our roadmap for the last quarter of this year includes PerpV2, and we have Synthetic Assets for early next year! Ultimately, we want to become a one-stop shop for all on-chain derivatives solutions!
https://polysynth.com/trade/options/vaults you can check the latest APYs here!
MaticNews: What advice did you give yourself when you started this project? What challenges have you faced?
PolySynth: The most important advice we gave ourselves was what users actually care about is their investing and trading experience, not what chain they are on or what kind of tech has gone behind building the product. So, what we have been doing at Polysynth is abstracting all of the complexities that come with DeFi and just giving users a seamless experience to make money without needing them to do the heavy lifting or thinking about how it all works. Over time, we aim to disappear into the background, meeting every financial requirement of individuals and institutions.

The biggest challenge we face is educating users on the advantages offered by DeFi over CeFi and TradFi. We have started many initiatives, such as building Polysynth Academy and working with high-trust communities like yourself to educate users. We hope, over time, we can make a big difference in raising the literacy about DeFi and its adoption.
MaticNews: Would you like to add anything else?
PolySynth: Yeah! We have two great repositories where users can learn how to write options and earn insane APYs in under 5 clicks!

If you follow our channel, you'll see a video exlainer series and material from Polysynth Academy which is a great learning resource.

Additionally hese are the results of this week's APYs for our protocol.

WETH Covered Call: 21.46%
WBTC Covered Call: 18.48%
ETH Cash Covered Put: 34.30%
BTC Cash Covered Put: 33.22%
MaticNews: Thank you for joining us for this AMA!
PolySynth: Thank you for having us, this was great!

Written By

Petrache Ionut

Aug 7, 2022