Structured Products
Build on-chain ETFs, options vaults, and managed indices with cryptographic safety.
The "Smart" Structured Product
Structured products (ETFs, Options Vaults, Baskets) require a delicate balance:
- Manager Discretion: A human (or algo) needs to pick the assets.
- User Safety: The user needs to know the manager won't run away with the money.
The Old Way: Trust or Rigid Code
- Trust: "Send funds to this address, we promise to trade responsibly." (FTX style - Risky).
- Rigid Code: "This contract buys ETH when RSI > 70." (Hard to update, easily front-run).
The Matador Way: Bounded Discretion
Matador enables "Bounded Discretion." You give the manager a key, but the key only works within the "sandbox" defined by the product's prospectus.
1. The On-Chain ETF (The "Basket")
Product: "Top 10 DeFi Tokens by Market Cap."
Manager's Role:
- Rebalance weekly to match the index weights.
- Add/Remove tokens if they enter/exit the Top 10.
Matador Policy:
- Allow: Trade on Uniswap V3.
- Constraint:
Token_Listmust be inCoinGecko_Top_50_Oracle. - Constraint:
Single_Asset_Weightcannot exceed 20%. - Constraint:
Slippage< 1%.
Result: The manager can trade freely to track the index, but literally cannot dump the portfolio into a rug-pull token.
2. The Options Vault (DOV)
Product: "ETH Covered Call Strategy."
Manager's Role:
- Mint options on Opyn or Lyra.
- Strike price selection based on implied volatility.
Matador Policy:
- Allow:
mintOptions,burnOptions. - Constraint:
Strike_Pricemust be >Current_ETH_Price * 1.1(Must be 10% OTM). - Constraint:
Expirymust be < 30 days. - Constraint: Cannot withdraw collateral (ETH) unless the option is settled.
Result: Users get the yield of a professionally managed strategy, but with the non-custodial guarantee of a smart contract.
3. Leveraged Farming (Delta Neutral)
Product: "USDC Yield on Aave + Uniswap."
Manager's Role:
- Loop leverage on Aave.
- hedge exposure on Uniswap.
Matador Policy:
- Invariant:
Net_Deltamust remain between -0.1 and +0.1. - Health Factor: Aave
Health_Factormust stay > 1.5.
Result: The manager can optimize yield, but if they get reckless and drift too far from delta-neutrality (risking liquidation), the transaction reverts.
Why Build Products on Matador?
| Feature | Benefit |
|---|---|
| Time-to-Market | Launch a new strategy in days by writing a Policy, not months writing Solidity. |
| Safety | Reduce audit costs. The complexity is in the Policy (easy to read), not the Contract (hard to read). |
| Transparency | "Don't be evil" becomes "Can't be evil." Your prospectus is on-chain. |