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Monteluna
@monteluna
As the market has ran through a huge swath of liquidations, I believe @letsgethai performed wonderfully. While it currently doesn't have the rate controller on to drive it's main price to the $1 USD market price, the threat of liquidations forces buyers to purchase HAI to repay debts. (1)
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Monteluna
@monteluna
As seen from the image, you can use HAI as a proxy for market demand of leverage, much like funding rates. As users borrow HAI and sell on the market, the price does down. At the lowest points in the past month, the market was ruthlessly selling HAI to lever up. Unfortunately the Money God always wins. (2)
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Monteluna
@monteluna
As the market price itself is a signal of "greed", the market naturally reverts to the mean. Around options closing on the 15 and 30th of the month, options markets drive prices down to liquidate derivatives sellers. HAI is no different, and we witnessed rapid demand for HAI to pay back debts. (3)
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Monteluna
@monteluna
While @letsgethai is still the cheapest leverage option on Optimism (it's only 1.5% APY to borrow HAI), traders should be careful loop leveraging and taking on so much risk. HAI rapidly reprices during demand shocks as seen by the graph. Don't be the last one without HAI during a crash. (4)
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Monteluna
@monteluna
As for novel trading ideas, because HAI is a proxy for this demand, purchasing HAI at low prices like $0.90-0.95 serves as a tactical way to be long market leverage. Setting up an automated index using Balancer or Velodrome is a good way to automatically buy low/sell high fyi. (5)
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