The term Sagitta refers not only to a constellation, but mathematically can be considered as the distance from the midpoint of an arc to the midpoint of its chord.
For this reason the term is useful in optics to characterize a measure of the convexity of a lens. Within DeFi, perhaps it may gain adoption as a term measuring something like the yield, or maybe leverage, one could get atop Convex Financeβs CVX token?
All through the bear market the few DeFi holdouts have been ranting about how CVX supply was scarce and it wouldnβt take much to ignite the CVX wars. Perhaps itβs time?
For one example, take a look at this particular growth curve. Can you spot the inflection point�
For the uninitiated, the chart shows off the effect of the launch of Asymmetry Financeβs $afCVX, which last week celebrated 2MM CVX locked. Not a ton at todayβs π€‘ prices, but with a supply capped at 100MM, itβs certainly enough to make this particular chart turn into a hockey stick.
Convex is so absurdly undervalued, this achieved escape velocity for just $5MM!
More from last week on why itβs Convexβs universe, and we just live in itβ¦
$afCVX may have kicked the hornetβs nest a bit, but everybodyβs coming for their royal nectar.
Convex offers native means of earning yield. On Convexβs website, one can stake directly to earn native 8.5%
Or lock to earn incentives via Votium, which last week yielded 18%
Not too shabby to earn a stream of revenue, while holding onto the outside chance that one day the DeFi doldrums end and the token itself appreciates in value. (Of course, not financial adviceβ¦)
Asymmetry fired the first shot in the latest skirmish of the Convex Wars by showing off yields of 34% β Sagitta?
Seems unbeatable? In fact, it would prove to be the start of the latest frenzy.
$xCVX & $cvxUSD
Leverage is a funny thing. Degens are addicted, though it takes some time for markets to equilibrate. For instance, our frens at Inverse Finance are scratching their head as to why lower fixed borrowing of CVX hasnβt enticed everybody away from the higher and variable rates at FraxLend β at least in sufficient quantity to push the markets closer.
But such is the demand for borrowing, that users donβt always mind high interest rates.
Carving out an unbeatable niche in this realm is f(x) Protocol. Their liquidation-free leverage formula abstracts so much of the complexities of borrowing/lending markets, while grounding themselves firmly in the stablecoin narrative. Now they bring their magic to CVX!
The leveraged $xCVX and its stable sister $cvxUSD we mentioned last week are already live. The protocol opened its vault for the tokens and it filled up extremely swiftly, about two hours by our tally of π timestamps.
They shared a few stats from the launch.
As of publication, this is a whopping 70%-175% or 72%-181% on the cvxUSD stability pools. Or for fans of leverage, you can get almost 2x
In our humble opinion, the work being done by f(x) Protocol is super under-appreciated by the broader market. Theyβve applied this same formula successfully to the largest cryptocurrencies in BTC and ETH.
If you are paying attention to CVX (and, indeed, reading this newsletter), youβre likely irretrievably far down the DeFi rabbit hole. Itβs exciting for many reasons, but where weβre most excited is to see data on how the f(x) Protocol formula works this far out on the long tail. Should xCVX / cvxUSD prove as stable as its other tokens, it would indicate their formula could be applied to pretty much any memecoin.
Proving such a track record is particularly bullish because the formula for degens is extremely compelling. Leverage without liquidations!
Or better yetβ¦ get PAID to lever through the points programβ¦
Thereβs not much CVX leftβ¦
Yet, it turns out the wars are even hotter than we imaginedβ¦
$cvgCVX
Convergenceβs solution for Convex is now live.
This oneβs been a bit slower to get off the ground than f(x) Protocol, closing in on 10% of its initial 1MM cap. We imagine this is because users are less familiar with the Convergence mechanic, whereas f(x) Protocol has already honed its mechanic on so many other larger tokens and got it down to an art form. In this case, f(x) Protocol has it a bit easy, as they are just dealing with naked CVX.
In contrast, Convergence, which focuses on being a metagovernance black hole, is attacking the various forms of CVX. That is, their products map to the staked and locked CVX.
Balancing so many moving parts, theyβve reduced it to the following construction:
Now that itβs launched, we get a look at what sort of vAPR we can expect, which is indeed a nice bonus.
We expect these yields wonβt be slept on forever. Thereβs also an optional CVXRush program for anybody who takes advantage of being early.
If youβre interested, study the mechanics from their Medium launch post and a separate post on cvgCVX specifically:
Disclaimers! Author is long $FXN, $CLEV, $CVG, $ASF, $CVX⦠did we miss anything?