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Celebrating 2 Years of the Index Coop
Celebrating 2 Years of the Index Coop
For the last two years the Index Coop has led the way in the emerging on-chain structured product space.
10/3/2022
Index Coop
Content
For the last two years the Index Coop has led the way in the emerging on-chain structured product space. But we’re not the same organization we were even a few months ago. In the last six months our community has transformed itself. Now, as we celebrate the second anniversary of our founding, we’re taking a moment to look back at where we’ve been.
On October 6th, 2020, the Index Coop was launched as an autonomous decentralized organization (DAO) by Set Labs. The community was made up of former TradFi professionals, engineers, and crypto enthusiasts. From the beginning we were united by a belief that decentralized finance is the future and that it’s up to us to make sure it includes everyone.
During that first year:
We launched the DeFi Pulse Index (DPI), which remains one of the industry’s
most successful on-chain index products
.
We raised >$10 million from venture capital firms, including Sequoia Capital, Galaxy Digital, 1kx, DeFiance Capital, Blockchain.com Ventures, Assembly Capital, 1confirmation, White Star Capital, and Wintermute.
We launched 6 products and our native governance token, INDEX, DPI, MVI, BED, DATA, ETH2x-FLI and BTC2x-FLI.
With a few early successes under our belt, what began as a small community of a few contributors soon grew into a large decentralized operation. At our peak in late 2021 we had 120 paid contributors and $500 million in TVL.
But even as we celebrated early success there were signs we were headed in the wrong direction. Disorganization and a lack of progress on important products frustrated some contributors. At times we failed to meet the needs of our external partners. We were dependent on Set Labs for the ongoing maintenance of some of our products and infrastructure. And a sober look at our balance sheet made it clear we couldn’t sustain our spend rate. We knew we had some hard choices to make. And our investors and partners saw that change was needed, too.
In April 2022, Set Protocol and 1kx published an open letter outlining their concerns. They asked us to:
Define who we are as an organization
Address over-spending and financial sustainability
Improve our relationships with external partners and collaborators
Refocus on building winning products
These recommendations helped kickoff a series of difficult conversations. Through the Summer and into the Fall we addressed all of the concerns outlined in the open letter by:
Reducing contributor spend by 40%
Developing and evangelizing a
strategy for winning in the on-chain structured product space
De-risking our treasury investments to better protect our runway
Working with Set Labs to return 9.5% of their INDEX to the Index Coop Treasury to incentivize high value contributors
Building out our technical stack and creating an Index Protocol fork of Set V2
The last two years have been a rewarding and transformative journey for our community and for DeFi as a whole. As we enter deeper into a global bear market, we could not be more optimistic about our ability to thrive and build products that are secure, accessible and simple to use.
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FAQs
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Leverage tokens automate a leveraged position by utilizing onchain money markets like Aave or Morpho to borrow funds, amplifying a user's exposure to an asset without requiring manual management. The token's smart contracts autonomously handle the borrowing, lending, and rebalancing of assets, maintaining a consistent leverage ratio despite market fluctuations. This automation eliminates the complexities of collateral management and liquidation risks, while also charging low, transparent fees that avoid expensive funding rates often charged by perps.
Index Coop is a decentralized autonomous organization (DAO) that specializes in creating and maintaining onchain structured products. Index Coop aims to democratize access to the crypto market, empowering everyone to participate in the growing digital asset ecosystem with ease.
No, yield automatically compounds and accrues to the token price. The value of the tokens you hold in your wallet will simply go up over time without the need to claim or compound rewards.
Index Coop products protect you from liquidation with automated risk management that rebalances assets to maintain a target leverage ratio that avoids liquidation.
INDEX is the ERC-20 governance token on Ethereum for Index Coop. INDEX empowers its holders to participate in decision-making processes that shape the future of Index Coop.
Yes, all Index Coop products are instantly redeemable for their underlying value at all times.
Yes, all Index Coop smart contracts have been audited by leading independent security firms such as OpenZeppelin, ABDK, Isosiro, & more. There is also an active bug bounty program through ImmuneFi. Audit information is published in the docs here.
Streaming fees (an annual fee paid continuously block-by-block), mint and redeem fees (only on leverage tokens), and borrow costs (interest paid to borrow funds from onchain markets when using leverage).