I am organizing a token buyback for my native token (while earning additional USDC).
DAOs occasionally want to participate in buy backs of their native token when they feel its undervalued. Conditional agreements make this simple by allowing you to create clear, time locked agreements to buy back tokens at set prices in the future.
These agreements are defined such that the purchases of tokens will only occur if the price drops below the price you're willing to buy them back at.
Example 1
Example: Jane (representing SWAP DAO) wants to buy back $35,000 worth of XYZ tokens if it decreases by 60% of the price they sold XYZ for.
If XYZ decreases by 60% from today's price in the next 4 months, we are agreeing to buy 35,000 USD worth. In addition, I want $5,000 USDC today for the token holders' protection. The net effective purchase price is actually $30,000 because of the $5k received offsetting the buyback price!
When someone purchases this agreement, two things can happen.
1) The price never drops 60% and the DAO keeps the $5,000 and unlocks their $35,000 USDC
2) The price does drop 60% and the DAO purchases $35,000 USDC worth of XYZ but in reality has only used $30,000 to buy back the tokens!
To make this happen, Hedgey protocol incorporates traditional financial options and repackages them specifically for the DeFi space. To make this specific strategy happen, we use Sell Put. To make your own insurance request, go to step 2b.
Last modified 2mo ago
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