Introducing GMX V2 Fund: Effortless Investment, Expert Management
Solv is excited to announce that we are partnering with the top market-making teams to launch a series of GMX V2 funds. These funds are designed to provide investors with opportunities to capture GMX V2 returns in a secure funding environment.
GMX V2 Leading the Decentralized Perpetual Exchanges
GMX introduced its V1 version at the end of 2021, quickly dominating the perpetual market with its efficient GLP model, establishing itself as a leading perpetual exchange. In August of this year, GMX officially launched V2, further enhancing market efficiency and liquidity. The team aims to solidify its position as a leader in the on-chain perpetual exchange and provide more profit opportunities for the crypto ecosystem, especially advanced players.
The core upgrades of GMX V2 include:
- Setting up isolated pools to increase high-risk trading assets while controlling overall risk.
- Adding synthetic assets to support assets not available on-chain.
- Modifying fee mechanisms to maintain a balance between long and short positions.
- Adding coin-based contracts, faster execution speeds, and lower slippage.
One month after its launch, GMX V2 had approximately $3,300 million in Total Value Locked (TVL), with an average daily trading volume of $23 million, daily protocol revenue of $15,000, and around 4,500 users. Its performance has been favorable despite starting in a bear market and without adopting any incentives.
GM Empowers LPs with More Concentration and Choice
GMX V2’s liquidity pools are independent of each other. Different token markets can have different underlying support and parameter settings, enabling individual risk control and flexibility, expanding the range of tradable assets while keeping risk manageable. Liquidity providers can choose and concentrate on the precise exposure they need based on their risk preferences and return expectations.
Market-making profits are primarily influenced by two factors:
- Fee income.
- Counterparty PnL.
Regarding 1), in V2, liquidity providers can flexibly choose market-making pools to earn more fees based on the volumes. Professional market-makers will have the opportunity to maximize their profits through real-time monitoring and analytical insights into the market, providing liquidity and momentum. Regarding 2), different tokens’ traders perform variably in changing markets, especially during volatility. Market makers require experience and reliable models to assess traders’ success rates and make precise exposure decisions.
So, how can ordinary investors participate? Investing in funds is the simplest and most efficient way.
GMX V2 Funds democratize pro LP strategies for all
Solv, in collaboration with top-tier market-making teams within crypto ecosystem, will introduce a series of GMX V2 actively managed funds, offering excellent sources of income for stablecoins, WBTC, and WETH. The strategies include:
- Delta Neutral Fund: Providing liquidity on GMX V2 while simultaneously hedging GMX V2 traders’ positions on centralized exchanges, stably earning fee income in a delta-neutral scenario to avoid losses caused by cryptocurrency price fluctuations.
- Opportunistic Fund: In different market conditions, especially in volatile environments, traders of different cryptocurrencies exhibit varying trading performances. Seizing these opportunities to earn income requires market makers to have sufficient trading experience and reliable models to assess traders’ win rates accurately, thereby selecting positions precisely and achieving higher returns.
- Funding Arbitrage Fund: Funding Arbitrage Fund: Open positions based on the long and short positions on GMX to earn funding fees, while hedging with spot and perpetual contracts to obtain funding fee income in a fully hedged, delta-neutral scenario.
Solv Integrates Top Liquidity Provider Networks
Whether it’s a market black swan event or the latest emerging profit opportunity, complex market conditions require active management for quick responses. The performance of fund managers directly determines the fund’s returns. Solv, as the first on-chain fund platform, has been working to establish a network of fund managers. For example, the quant team Blockin has already issued 9 funds on Solv V3, with the representative GMX V1 Neutral Strategy Fund managing over $3 million, maintaining stable returns of 10%-30%, with only a minor 1.1% drawdown during the stablecoin decoupling period.
Solv Integrates Institutional Networks
Solv has established strong partnerships with CeFi institutions such as Binance, gaining a network advantage in asset screening and creation. This allows Solv to continuously bring a more diverse range of strategy choices to the market.
Solv Provides Flexible Fund Infrastructure for Efficiency and Security
Solv provides a flexible infrastructure for active management strategies, ensuring efficiency and security.
To prioritize fund safety, we implement a comprehensive risk control system for GMX V2 funds, including:
- Fund Manager Qualification Review: Collaborating with brokers and rating agencies to rigorously assess funds based on AUM, returns, strategies, team background, and more.
- Layered Fund Permissions: All funds on the Solv platform are transferred to designated MPC solutions via Solv V3 smart contracts, with distinct roles for transfer, liquidation, and operations rights to prevent scams or fraud. Investors can monitor real-time fund flows and influence permissions through custody dashboards.
- Liquidation Mechanism: Trusted institutions establish liquidation rules for each fund to limit losses. Risk managers monitor positions, issue alerts, and handle orderly liquidations if needed to prevent additional losses.
The first GMX V2 open-end fund is now live(https://app.solv.finance/earn/open-fund/detail/5), and it’s a delta-neutral strategy open fund. Investors can join at any time, track the fund’s performance on the fund details page, and choose to redeem at any time.
We take the launch of new funds very seriously. Before the launch of GMX V2, we engaged in in-depth discussions with the GMX team and the market-making team to understand their products and design philosophy. Prior to the official launch of V2 funds, we also conducted testing of similar strategy funds. We believe that V2 will be a highly promising source of real DeFi returns and hope to provide more investors with access to these profit opportunities.
About Solv V3
Officially launched in 2023, Solv V3 has pioneered the construction of a trustless fund infrastructure based on ERC-3525. It also achieved decentralized collaboration between trusted institutions to offer transparent, non-custodial DeFi risk control. It allows global investors to access varied, trusted crypto investments on one transparent and secure platform, and empowers excellent fund managers to efficiently raise capital and build on-chain credibility.
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