Aug 26, 2021

4 min read

Launching zUSD as the collateral on perpetual contract platform-Deri Protocol

Duet/Zerogoki is a synthetic assets platform with a unique algorithm-pegging mechanism that has stepped into a brand-new stage. Deri has launched a perpetual contract pool for Zerogoki USD (zUSD). It’s another dimension expansion for zUSD’s utility since Harvest and Wault.

Deri is a blockchain-based derivatives protocol. Using zUSD users can easily, precisely, and capital-efficiently trade BTC, ETH on BSC’s Deri and obtain leverage exposure up to 10X.

  1. zUSD address on BSC: 0x92d499e9953979c1a18ae6ff1e952f2cfbdd172d

2. A few BNB as gas fee

3. Log into, switch Deri to V2, choose BSC network, and click the “Open” tab under the trade section.

In order to obtain transaction fees, funding fees, and Deri rewards, liquidity providers provide liquidity to the pool. Therefore, they are the opponents for traders and they can also obtain the loss fund of traders.

2. Traders

With Deri protocol, traders can acquire the targeted risk exposure precisely and capital-efficiently, and traders can open long/short positions of BTC and ETH.

3. Arbitragers

Pools will charge funding fees for the majority. Therefore, the simplest way to arbitrage is to take the short side of pools. Arbitrageurs are a special type of traders, who are induced by the funding fee. They arbitrage to balance the two sides of long and short positions.

a) Add zUSD’s liquidity: Become liquidity provider for zUSD

  1. Transaction fee
  2. 50% of the remaining value after liquidation
  3. Funding fee
  4. Opponent’s profit/loss

Steps involved in each Role :

1. Log into Deri “open” section’s liquidity pools for zUSD.

2. Add zUSD as liquidity

3. After adding, check my liquidity providing to see share value

As traders, using zUSD can easily, precisely, and capital-efficiently trade BTC, Ethereum on BSC’s Deri and obtain leverage up to 10x.

  1. Click the approve first under the trade section

2. First-time users need to deposit margin

3. Derivatives

Take BTC/zUSD 10X as an example

BTCUSD is index price, zUSD is mark price, users can open either long or short positions.

Select direction, adjust the margin, then start to trade. Use zUSD to pay margin and transaction fee rate.

4. Finish ordering, current position, and trade history can be viewed

5. Click “my position” to see detailed information

Funding Fee Arbitrage Mechanism

Pools use external exchange prices (provided by Oracle) as profit or loss for positions. Since pools will charge funding fees for the majority, the simplest way to take the short side of pools. Steps are shown below:

1. Read the current funding rate of the pool. When it’s positive(negative), enter a short(long) position.

2. Accordingly, hedge your short/long position outside (if people are holding positions or holding positions at a CeFi exchange)

3. Enjoy collecting the fundings earned (i.e. negative funding fee) as long as the sign of the funding rate does not flip.

About zUSD

Features of zUSD:

  1. zUSD utility and necessity for Zerogoki system: Since there are a series of synthetic assets in Zerogoki, we only reward the people who provide liquidity between zUSD and these zAssets. Therefore, in order to trade zAsset, zUSD needs to be used, and another stablecoin has no direct liquidity between zAsset
  2. Rewards: Users could also provide liquidity for the zUSD between other mainstream stablecoins to get system rewards, which is the second reason to own the zUSD
  3. Robustness: zUSD had experienced a hacker attack in which the price of the zUSD dropped by 70% at one point, it took less than a day for the price anchor and liquidity depth to return to their pre-attack levels, demonstrating excellent mechanism design and strong community consensus.
  4. Amazing growth: After one month’s release, Zerogoki’s zUSD has been ranked 3rd in volume and 4th in liquidity within the category of algorithm stable coins on #Uniswap.

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