About Hegic Coin
Hegic price today is $0.168336 with a 24-hour trading volume of $5,087,698. HEGIC price is up 0.1% in the last 24 hours. It has a circulating supply of 510 Million HEGIC coins and a max supply of 3.01 Billion. Bancor Network is the current most active market trading it.
What is Hegic?
Hegic is a decentralized on-chain protocol which allows users to purchase American call and put options on Ether (ETH) and Wrapped Bitcoin (WBTC). They may also choose to act as liquidity providers to sell those options instead and earn premiums. Using the platform’s interface, users can customize the terms of the options that they want to purchase, such as the strike price and expiry date.
The price will automatically be calculated once the terms are selected, which includes a 1% settlement fee on the option size purchased. Although the options are non-tradeable, users can exercise them at any time since liquidity is locked on the option contract.
What are HEGIC tokens?
HEGIC tokens are the platform’s governance tokens which can be used to influence the direction of the protocol’s future. It can also be placed into staking lots to receive settlement fees from option buyers. To acquire a staking lot, you would need to have 888,000 HEGIC. However, you may also stake any amount of HEGIC through third-parties such as zLot or Hegic Staking.
How does Hegic work?
Liquidity providers lock up their funds in either the ETH pool or WBTC pool and receive a certain amount of write tokens according to the asset provided. Write tokens represent the provider’s claims on the premiums paid by users to purchase options. The pooled liquidity is then used as collateral for both calls and puts in the event that users wish to exercise their options. The maximum utilization of the pool is set at 80%.
The price of the options are determined based on specific formulas for both call and put options, which involves the price of the underlying asset. These prices are relayed through Chainlink oracles and are updated every hour or if there the change exceeds a set percentage (0.5% for Ether and 1% for WBTC).
Option holders pay the premiums and settlement fees using Ether. They can view their active and historical options purchased, and also exercise their active options if they are in-the-money. Proceeds for exercising the options will be paid out based on the asset selected, i.e. ETH paid out for ETH options, WBTC paid out for WBTC options. To know more about the new version of HEGIC, known as HEGIC v888, you may refer to this Medium post.
How do I get HEGIC?
You can obtain HEGIC by purchasing it on their bonding curve. Alternatively, HEGIC can also be obtained by buying them from exchanges such as Binance or Uniswap. Beside the two exchanges, you can find HEGIC trading on other various centralized and decentralized cryptocurrency exchanges.
Another interesting way to earn HEGIC is to use the platform. HEGIC provided liquidity mining and utilization rewards to users who stake their write tokens obtained after providing liquidity to one of their two pools and also to option buyers based on the option size and duration.
However due to feedback from the community, staking write tokens and purchasing options no longer provide rewards in HEGIC. Instead, rewards are given in rHEGIC, which represents a 1:1 claim on HEGIC.
The rHEGIC tokens earned will be claimable for HEGIC tokens after the cumulative on-chain trading volume on Hegic during Phase I, which runs until 9th September 2021, exceeds $100M or on November 11th 2021. rHEGIC needs to be manually claimed from the Liquidity Utilization interface under the Token Holder’s section. More information regarding the change in rewards can be found on their Medium post.