Dual Investment | Explanation of Key Terms
For users who are not familiar with Dual Investment, please continue reading.
To understand how Dual Investment functions, we should first explain some of the key terms associated with the product.
- Underlying asset: The asset that the reference price and strike price are referring to. Currently, the underlying assets offered by AntiMatter for Dual Investment are BTC and ETH.
- Deposit currency: The asset that you are depositing into AntiMatter Dual Investment. Currently, you can choose between ETH, BTC and USDT.
- Alternate currency: The asset that your deposit currency will be converted into if the product is exercised.
- Reference price: The current price of the underlying asset.
- Settlement price: The current price of the underlying asset at 08:00 UTC on the delivery date. This price is then compared to the strike price to determine if the product should be exercised.
- Delivery date: The date when the price of the underlying is checked against the strike price. You cannot withdraw your funds before the delivery date.
- Strike price: The price level that determines whether the deposit currency will be converted or not. The strike price is checked against the settlement price to determine the result. The strike price is used as the conversion rate if the product is exercised.
- APY (Annual Percentage Yield): Each AntiMatter Dual Investment product has an associated APY. The APY of each product fluctuates over time, but your personal APY will be locked in once you subscribe to the product. To avoid confusion and unrealistic expectations, we should note that this figure is annualized.
Antimatter Dual Investment explained: Up-and-Exercised & Down-and-Exercised
There are two kinds of Antimatter Dual Investments that you can invest in. You deposit BTC or ETH in the Up-and-Exercised products, while the Down-and-Exercised products accept stablecoin deposits. Let’s learn more about how these two products work.
In this type of Dual Investment product, your deposit is converted into the alternate currency if the settlement price of the underlying asset is above the strike price at the delivery date.
Let’s say you’re using an Up-and-Exercised product with BTC as the underlying asset. If the price of BTC is higher than the strike price at the delivery date, your BTC and accumulated interest will be converted into USDT.
If the product is not exercised, you’ll receive your deposited BTC, plus interest.
In Down-and-Exercised products, your deposit currency is converted into the alternate currency if the settlement price of the underlying asset is below the strike price at the delivery date. Currently, you can deposit either USDT or USDT into Down-and-Exercised products. If exercised, your stablecoins will be converted into BTC or ETH (depending on which product you used).
For example, let’s say that you deposited USDT into a Down-and-Exercised product that uses ETH as the underlying asset. If the price of ETH is lower than the strike price at the delivery date, your USDT, plus the accumulated interest, will be converted into ETH.
If the product is not exercised, you’ll receive your deposited stablecoins, plus interest.