DeFi Insight: Non-custodial Dollar Cost Averaging — Mean Finance

  • People who want to get the best average price on an asset over a long period of time.
  • People who aren’t professional traders.
  • People who succumb to emotions such as the fear of missing out.

Mean Finance and DCA

Mean Finance is an open protocol that enables users (or dApps) to dollar cost average ERC20 into any ERC20 with their preferred period frequency without sacrificing decentralization or giving up personal information to any centralized parties. The protocol enables users to set up actions like swapping between pairs of tokens. For example, one could set up an ERC-20 pair DCA order where a stablecoin is exchanged daily for another asset. Even though such an operation would seem simple and could be executed manually, there is the problem of gas fees for each purchase. Mean Finance elegantly solves the gas challenge. Users don’t have to pay for their swaps to be executed after setup. The users only pay fees when interacting with their positions (for example, by adjusting the buy intervals). The protocol introduces participants called swappers (AKA market makers) whose role is to execute individual transactions. Incentives for swappers include arbitrage opportunities between the oracle aggregator and external DEXes, rewards for providing liquidity to balance out swaps, and a sharing of the 0.6% protocol fees applicable to each position. When users interact with their positions, no protocol fee is charged. Protocol fees are collected only on swaps. As of now, that fee is 0.6%.

Figure 1: Yield generation on Mean Finance. Source: mean.finance
Figure 2: Total DCA Volume by Pair on Optimism. Source: dune.com
Figure 3: Total DCA Volume by Pair on Polygon. Source: dune.com

The International Token Standardization Association (ITSA) e.V.

The International Token Standardization Association (ITSA) e.V. is a not-for-profit association of German law that aims at promoting the development and implementation of comprehensive market standards for the identification, classification, and analysis of DLT- and blockchain-based cryptographic tokens. As an independent industry membership body, ITSA unites over 100 international associated founding members from various interest groups. In order to increase transparency and safety on global token markets, ITSA currently develops and implements the International Token Identification Number (ITIN) as a market standard for the identification of cryptographic tokens, the International Token Classification (ITC) as a standard framework for the classification of cryptographic tokens according to their inherent characteristics. ITSA then adds the identified and classified token to the world’s largest register for tokens in our Tokenbase.

  • The International Token Identification Number (ITIN) is a 9-digit alphanumeric technical identifier for both fungible and non-fungible DLT-based tokens. Thanks to its underlying Uniform Token Locator (UTL), ITIN presents a unique and fork-resilient identification of tokens. The ITIN also allows for the connecting and matching of other media and data to the token, such as legal contracts or price data, and increases safety and operational transparency when handling these tokens.
  • The International Token Classification (ITC) is a multi-dimensional, expandable framework for the classification of tokens. Current dimensions include technological, economic, legal, and regulatory dimensions with multiple sub-dimensions. By mid-2021, there will be at least two new dimensions added, including a tax dimension. So far, our classification framework has been applied to 99% of the token market according to the market capitalization of classified tokens.
  • ITSA’s Tokenbase currently holds data on over 4000 tokens. Tokenbase is a holistic database for the analysis of tokens and combines our identification and classification data with market and blockchain data from external providers. Third-party data of several partners is already integrated, and API access is also in development.

Remarks

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International Token Standardization Association

International Token Standardization Association

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The International Token Standardization Association (ITSA) is a not for profit organization working on holistic market standards for the global token economy.