Announcing Open Options Minting on Solana
Over the last 6 months, Zeta Flex has been used successfully by some of the industry leading protocols for on-chain derivatives. Today, we’re excited to announce the first step towards making this software more open and accessible than ever, starting with the Zeta Flex minting interface and API. Head to https://flex.zeta.markets/mint to see how you can create almost any on-chain derivative contract with a range of adjustable parameters.
How does it work?
Zeta Flex is an on-chain derivatives application that allows you to create contracts between counterparties that are enforced at the protocol layer. The rights to access the benefits of the contract are tokenised and can be transferred between wallets.
Just like any real world contract, there’s plenty of things you can do to customise the terms between 2 counterparties with Zeta Flex.
To use the interface, follow these steps:
- Navigate to https://flex.zeta.markets/mint.
- Connect your wallet.
- Select the type of option you would like to create: Cash or Physically settled.
- Enter the mint key of the collateral you would like to use. You can see a full list of available collaterals here.
- If you are creating physically settled options, enter the mint key of the currency you would like the end user to exercise with. Full list of definitions here.
- Select the strike price you would like the end user to pay for the tokens.
- Select the Settlement Start Date.
- Select the Settlement End Date (Expiry).
You can view your active option contracts by connecting to https://flex.zeta.markets/dashboard.
For API access, use npm i @zetamarkets/flex-sdk and reach out to us on discord if you have any questions.
Documentation soon…
What can you do with this tool?
Options can be used to replace any token distribution event. Distributing options rather than tokens can allow you to capture more upside per token spent. For the end user, more flexibility is awarded, giving them the right, but not the obligation to receive anything. This flexibility is useful for a number of popular use cases in DeFi today:
- Liquidity mining: Reduce downward sell pressure from toxic farmers and earn revenue on your liquidity mining program. Incentivise constructive activity from your community by offering liquidity mining rewards with options.
- Community sales: Improve the economics of your token launch. Remove incentives for ‘token flippers’ and ‘air-droppers’ while maintaining favourable benefits for the true believers in your protocol.
- Token vesting: Align incentives with contributors or ecosystem partners. Distribute options that give the owner the right to buy at a discounted rate to the current market price.
- Yield generation: Earn yield on idle token holdings by taking a view on price and selling options.
- Bespoke solutions: Speak to us in discord if you have any questions on using this tool for anything not listed above.
Risks
- Smart contract risk.
- Take careful note of the parameters you set for the contract. Once the options are minted, the terms can’t be changed.
- Only the holder of the option token has the right to the option. Once tokens are transferred to another wallet, only the holder of the private key of that wallet is entitled to the benefits of that option.
Conclusion
Zeta Flex allows you to create options with Solana SPL tokens, allowing you to take a more nuanced approach when transacting in DeFi. We’re exited to see how options can be used to improve incentive alignment within the ecosystem.
