Deri AMA Recap on December 8th, 2023

Deri Protocol
6 min readDec 8, 2023

On December 8th, Deri launched a Deri AMA. Let’s watch the detailed & complete AMA recap below:

The AMA Entrance: https://bit.ly/DeriDiscord

OxAlpha:

Hello, Deri fellows! I hope you are all doing well. Like always, let me start by briefing the updates. And here they are:

1. Following the DIP9 result, Deri v4 is live on Scroll now. Cheers!

2. ARB and DERI tokens have been launched on V4 as base tokens. You can use them to stake for real yield and trade derivatives as margin.

3. And here are the new strikes that we recently added to Deri V4:

BTCUSD $41000 Call, BTCUSD 41000 Put
BTCUSD $42000 Call, BTCUSD 42000 Put
BTCUSD $43000 Call, BTCUSD 43000 Put
BTCUSD $44000 Call, BTCUSD 44000 Put
BTCUSD $45000 Call, BTCUSD 45000 Put
BTCUSD $46000 Call, BTCUSD $46000 Put
BTCUSD $47000 Call, BTCUSD $47000 Put
BTCUSD $48000 Call, BTCUSD $48000 Put
BTCUSD $49000 Call, BTCUSD $49000 Put
BTCUSD $50000 Call, BTCUSD $50000 Put

ETHUSD $2400 Call, ETHUSD $2400 Put
ETHUSD $2600 Call, ETHUSD $2600 Put
ETHUSD $2700 Call, ETHUSD $2700 Put
ETHUSD $2800 Call, ETHUSD $2800 Put
ETHUSD $2900 Call, ETHUSD $2900 Put
ETHUSD $3000 Call, ETHUSD $3000 Put

OK, so much for the update briefing.

Before I start to address all the questions here in the channel, let me first copy & past one from the FAQ, which is also question that was frequently asked in the general-chat channel.

As the Linea Voyage is still on going, this one is concerning many of the voyage participants.

Q: Why is there an additional ETH payment in addition to the regular gas fee?

A: As an xDapp, Deri V4 splits an operation (e.g., trade, add/remove margin, add/remove liquidity) into several steps executed on different blockchains. For instance, consider an “Add Liquidity” action initiated on Linea (the iChain), which involves three steps:

LP calls requestAddLiquidity on Linea.
Executor calls executeAddLiquidity on Deri Chain.
Executor calls finishAddLiquidity on Linea.

In step 1, the LP pays the regular gas fee for calling requestAddLiquidity and an execution fee (or “pre-paid gas”) for the executor to perform steps 2 and 3.

Execution Fee = dChain Fee + iChain Fee, where dChain Fee covers step 2, and iChain Fee covers step 3.

Given that step 2 occurs on L3, the dChain Fee is minimal, currently set at 0.00025ETH, and will be further reduced as we refine our architecture.
The iChain Fee is equivalent to the gas fee for calling finishAddLiquidity and varies based on the specific iChain.

Q: Does that mean I need to pay three times the regular gas fee?

A: No, you are paying less.

Deri V4 merely breaks down the procedure into three parts executed on different blockchains. This approach causes almost zero additional cost compared to a scenario where the entire procedure is consolidated into one function call and completed in a single transaction on one blockchain. In the one-chain-one-transaction setup, you are still paying gas to finish all the procedures of the three steps, and your cost for step 2 would likely be much higher as it would be processed on iChain.

Therefore, by executing a considerable portion of the process on Deri Chain (an extremely cost-effective L3), the overall gas cost is actually reduced.

OK, now let’s move on to the AMA questions.

Q: Buyback is the most keyword to reduce the supply and make the token more expensive, could team make more plans of buyback to burn monthly and report automation in twitter? Thanks.

A: Well, there is no such thing as buyback. I said this many times before and I want to emphasize it again:
There is no such thing as buyback in the DERI tokenomics!

However, If you are talking about the burning procedure of DERI, OK that’s regularly carried out (but that’s definitely not a BUYBACK!). The DERI-burning is regularly disclosed in the monthly reports, and here is the most recent one:

https://deri-protocol.medium.com/deri-protocol-monthly-report-for-november-2023-d8f38ccede45

You can also check out this dead-lock address, where you can see all the burned DERI tokens:

https://etherscan.io/token/0xa487bf43cf3b10dffc97a9a744cbb7036965d3b9?a=0x000000000000000000000000000000000000dead

We kept burning DERI!

Q: I am a DERI holder on BSC. When will Deri V4 support BSC? I want to use DERI for LP. I have been doing LP in the DERI pool of V3 before, but now the mining in that DERI pool has stopped.

A: Well, there are several issues related to this question. Let me address them one-by-one.

First of all, regarding the support of BSC as iChain, this is not up to us (the team). It’s completely decided by the community governance. BSC was nominated in the past several DIP votings but not chosen by the community yet. I will not make predictions about the voting result in the future. So for your question “When will Deri V4 support BSC?”, the answer is I don’t know.

Secondly, DERI-staking is supported already, but right now only on Arbitrum. All that you need to do is to migrate your DERI from BSC to Arbitrum. Please refer to this FAQ about how to migrate
https://deri-protocol.medium.com/deri-v4-faq-dde7369de90c
Medium

Finally, I’d like to clarify that deploying on BSC as an iChain has nothing to do with supporting DERI as a base token in the Deri V4 pool. If BSC is selected as an iChain, it does not necessarily mean that the DERI token will be adopted as a base token on BSC. In Deri V4, we have no plan to launch any DERI-based-only pool, where DERI was the sole base (and settlement) token, just like the one launched in Deri V3. Instead, DERI will be one of the several base tokens in a mixed pool, just like currently on Arbitrum with V4. However, this setup includes a swapper, standing by to exchange between DERI and other tokens when necessary. Consequently, DERI can only be a base token on blockchains where it’s easily tradable via DEX. Currently, Uniswap on Arbitrum is the only officially supported DEX, making Arbitrum the sole blockchain where the V4 pool supports DERI as a base token at present. Looking ahead, we are open to supporting DERI as a base token on any blockchain where it has substantial DEX liquidity. I’m hopeful that this prerequisite will be met sooner rather than later. However, it’s important to note that this is beyond my control.

Q: Does the project team have plans to put the arb incentives received into the pool to increase liquidity?

A: Not yet. We still have not decided yet how to use this part of the treasury.

Q: Regarding the improvement of TVL, the project is launching staking mining , but the effect is not obvious. Will there continue to be activities to attract users to stake to increase TVL?

A: The TVL and the trading volume are in a chicken-and-egg relationship. Fortunately, we are in a good track. Deri V3 has been deliver 8% real yield in less than 1 year (not including the DERI reward). (https://twitter.com/0x_Alpha/status/1727508661789200419) Whereas, Deri V4 had a great kick-off — 2% real yield already in two weeks. (https://twitter.com/DeriProtocol/status/1732645542407332258) That real yield is the best and the long-term attraction for TVL. Meanwhile, why don’t you just tell your friends that they can stake USDC, DAI, ETH, WBTC, DERI, etc on Deri V4 to earn some real yield? While the stats have already shown how great the product is, the best way of marketing is you telling your friends about Deri, isn’t it?

About Deri Protocol

Deri, your option, your future!

Deri is the DeFi way to trade derivatives: to hedge, to speculate, to arbitrage, all on chain. With Deri Protocol, trades are executed under AMM paradigm and positions are tokenized as NFTs, highly composable with other DeFi projects. Having provided an on-chain mechanism to exchange risk exposures precisely and capital-efficiently, Deri Protocol has minted one of the most important blocks of the DeFi infrastructure.

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Deri Protocol

Deri Protocol = (Perpetual Futures + Everlasting Options) x Decentralized.