Introduction of Metaverse Index "MVI" through Index Coop

Introducing the Metaverse Index (MVI) via Index Coop

Index Coop has launched its latest product, the Metaverse Index (MVI).

MVI is a basket of 15 tokens designed to capture the shift of entertainment, sports and business to virtual environments. The index is represented by ERC20 tokens, which can be purchased at tokensets.com.

In this blog post:

methodology

methodology

Where to Buy and Use MVI

Why was the Metaverse index created?

A good definition of Metaverse comes from Enjin, one of the foundation projects in the MVI index:

The "metaverse" is a shared digital space that seamlessly integrates aspects of the real world, especially things like ownership, identity, and financial value.

Shared digital spaces are made possible by the development of blockchain and virtual reality technologies. User-centric token economic design is one of the key innovations at the intersection of these two technologies. It creates the opportunity for anyone to own a portion of the metaverse and its unlocked value.

Virtual worlds and digital experiences themselves are not a new phenomenon. But digital trends are accelerating as more and more people turn to virtual realms for business, entertainment and social interactions of all kinds.

At a high level, the metaverse index aims to turn this trend into an investable token.

There are 4 main advantages of using MVI:

Simplicity - MVI provides an easy way to capture broad market trends based on the concept of the metaverse without the need for constant research and rebalancing of portfolios.

Risk Management - Holding an index can offset the volatility of individual tokens.

Cost Efficiency - Reduced Gas (network transaction) fees compared to buying and selling tokens individually.

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Index composition at launch

https://miro.medium.com/max/2400/1*8x3ETDk1NkBTiZRdfroisw.png

Initial MVI Portfolio Weight

Methodology - Basics

Index Coop products follow a rigorous methodology and MVI is no exception. The following is a high-level overview.

initial screening process

The portfolio building process started by screening the following token categories on Coingecko: non-fungible tokens, entertainment, virtual reality, augmented reality, and music.

The tokens must also have an ERC20 token, a circulating market cap of more than $30 million, and sufficient liquidity to be traded on a decentralized exchange (DEX).

Basic Token Review

The metaverse and all the realms it contains are still in their early stages and require qualitative oversight. Therefore, MVI methodologists consider whether a token is correctly classified, whether it fits the metaverse description, whether the project has plans to move to the second layer and how it will affect its DEX liquidity, and may disadvantage passive holders any considerations.

Portfolio Construction

MVI uses a combination of the square root of market capitalization and liquidity weights to arrive at the final index weights. Mobility is an important consideration, according to methodologists. The metaverse market in general is still young, and thin liquidity complicates chain rebalancing and portfolio allocation.

in,

TW = 75％* RMCW + 25％* LW

in,

TW represents token weight in $MVI

RMCW means the square root of the market capitalization weighted allocation

LW means liquidity weighted allocation

Where to buy and use MVI at launch

The MVI was released on April 7. Available at TokenSet or Uniswap. Users can also directly use the basic components on TokenSet to create MVI index tokens.

Currently, there is a liquidity mining incentive program for liquidity providers in the Uniswap MVI/ETH pool. LP tokens can be wagered at Index Coop. The program will run for 90 days starting April 8. The goal of the program is to achieve a 35% APY on a $5 million pool in the first 30 days. Rewards over 30 days will continue to target $5 million in liquidity based on average mining returns over the past 7 days. If the pool is greater than $5 million, the reward will be reduced proportionally (a pool of $10 million will get ½ of the reward). Likewise, there will be an increase in incentives for smaller scale.

Translation: Prickly Thorn

Original: Artem Gramma