What Is Hegic (HEGIC)?

Hegic is a decentralized trading protocol based on the Ethereum blockchain that creates, maintains, and settles Hedge contracts in a trustless manner. The hedge contracts are options-like on-chain contracts that allow traders to trade their assets at a pre-decided price on a future date. The prices of options are automatically set lower on the Hegic platform than that on the centralized exchanges.

This platform makes it an easy to trade option as it provides many features:

• Users have to pay a fixed premium to enjoy the benefits of their options trading.

• The Hegic covers gas fees applicable on the transaction. Gas is the pricing value required to complete a transaction on the Ethereum blockchain.

• Users don't have to apply for KYC (know your customer) or registration as the protocol never asks users to share their name, email address, or any ID proofs.  

• Hegic offers low prices for ETH and WBTC (Wrapped Bitcoin) options that help users to pay less premium.

• The platform provides liquidity pools for users to trade in the on-demand options. For liquidity providers who seek to improve trustless options trading, Hegic proposes a mechanism that combines a pool model. Hegic liquidity pool contracts generate liquidity from many market participants simultaneously. Its whitepaper states that this strategy minimizes the danger of losing funds while providing liquidity providers with their profits. 

The ETH pool of Hegic is non-custodial, and liquidity providers can earn ETH in exchange for their services. The entire amount of ETH placed in this pool is utilized for trading ETH call options, and holders of these options can exchange their DAI for ETH at the strike price after the options expire. The DAI pool is reserved for DAI liquidity providers to trade ETH put options. This pool is for traders who seek to purchase puts from providers who deliver their portion of DAI in exchange for writeDAI tokens.

HEGIC is an ERC-20 coin that serves as the platform's utility and governance token. The HEGIC token is utilized to distribute settlement fees among token holders and in the protocol's on-chain governance. The HEGIC token is utilized in HIPs (Hegic Improvement Proposal). The Hegic Token holders have the right to vote on the issues like hedge contract assets and rates, strike price suppliers, settlement fee size, and more.

History of Hegic (HEGIC)

The Hegic protocol was founded by Molly Wintermute. The whitepaper of Hegic was launched on February 20, 2020.