FAQ

What are exotic options?

Exotic options are hybrid financial securities that offer unique and customizable payment structures, expiration dates, and strike prices. Exotic options have the following advantages over vanilla options:

• Advanced trading strategy

• Earn superior yields

• Add downside protection for trading

• Express views of the market flexibly

• Customize trading positions to meet specific risk/return needs

What are structured products?

Structured products are pre-packaged structured finance instruments that are embedded with derivatives. Features like return, maturity value, and settlement mechanism will be referred to the following:

a. Change in value of the related assets

b. Whether some event occurs or not

Our team is from top financial institutions. We trade structured products under strict risk management system to protect your wealth.

When is a good time to buy structured products?

Structured products allow you to grow your wealth by taking advantage of market conditions. We offer a range of products to suit your risk-return needs, regardless of whether the market is bullish, bearish, or oscillating. These products have higher potential returns than linear perpetual contracts and spot products

When will I receive my earnings?

You will receive your coupon earnings on the settlement date, which is either the product's maturity date or the early knock-out date. The principal and interest will be exercised and assigned at 16:00 (UTC+8) on the settlement day, with automatic settlement and delivery at 18:00. It's important to note that the assigned party (i.e., the losing side) needs to settle manually between 16:00 and 18:00, otherwise, a settlement fee will be charged.

What currencies are supported for subscription on the platform?

VETA platform primarily settles in USDC. All products can be subscribed to using a collateral pool credit model, supporting currencies such as BTC, ETH, USDT, USDC, and DAI. More cryptocurrencies will be supported in the future.

I have BTC and ETH; how can I enhance my earnings in terms of the original currency?

Investors can pledge and deposit WBTC (which needs to be converted) and ETH on the "Asset Portfolio" page, and obtain a credit line based on different collateralization ratios (e.g., 70% for BTC), which can then be used to purchase financial products on the VETA platform. For example, by investing in low-risk yield products, an enhancement of about 10% on BTC basis can be achieved.

Unlike traditional asset pledging where users bear the cost of capital, VETA offers free credit for pledging, while users can also earn from lending out their collateral (akin to an appreciation of collateral). This differs from other platforms where investors have to pay a borrowing cost if they mortgage assets to invest in cash. The integration of the margin system and transaction settlement maximizes the efficiency of capital use.

Investors need to constantly monitor the risk value to stay within a healthy range to avoid forced liquidation, as credit lines fluctuate with market prices, held products, and collateralization ratios.

What are the sources of returns for structured products?

The returns of structured products primarily come from the volatility of the underlying assets. Crypto assets have an inherent high volatility premium, and by using structured products to capture this volatility premium, our team packages algorithmic and volatility trades from an automated trading platform into financial products that are easy for investors to participate in.

How does VETA ensure the security of assets and the fulfillment of product earnings at the fundamental level?

VETA is a structured product platform within the Ethereum DeFi ecosystem. The principal is never touched; collateral earns additional interest on lending platforms, ensuring asset safety with a transparent mechanism and no risk of fund misappropriation. The issuer needs to lock the product's coupon in a smart contract on the blockchain in advance. Upon maturity, depending on the product mechanism, the Chainlink oracle automatically transfers funds based on the different scenario conditions, eliminating counterparty risk.

What earnings can investors receive?

Investors can receive three parts of earnings: (1) Lending interest income. Investors deposit assets in the collateral pool and earn interest income through the AAVE lending platform, ranging from about 0.01% - 20%. (2) Currency appreciation earnings. Investors share the appreciation of the underlying assets, not missing out on the bull market. (3) Volatility earnings. Investing in structured products for volatility earnings, with different risk preference products to meet investor needs.

Isn't the return on structured finance lower than direct investment in spot?

Structured products outperform direct holding of spot in all but one-sided upward trends, achieving currency basis enhancement. The effect is especially pronounced in flat and bear markets, and they offer a stable return with a protective cushion compared to spot investments. Reliable and relatively substantial financial returns can be obtained in most scenarios (historical data shows 80%+ profitability). The snowball product's earnings come from the trading team's "sell high, buy low" strategy to capture volatility gains, with a transparent product mechanism. Most market conditions (upward, flat, and partial downward trends) can yield predetermined coupons; meanwhile, the snowball base can set a maximum loss threshold. Investors can also obtain additional volatility gains while holding currency by using the pledged credit line.

Is there any risk associated with VETA’s products?

VETA offers different types of structured products, including floor clause, yield enhancement, participation and leveraged products. The risk level can vary, with some being less risky than linear perpetual contracts and others being riskier.

You can choose the product that fits your market views and risk tolerance by referring to our product offerings.

How do VETA's products generate returns？

When you purchase a structured product, you are getting a pre-designed set of financial instruments to help you express your market views. The success of a structured product depends on the combination of options chosen, which should align with your market views and provide a higher chance of success with reduced risk.

What is the difference between structured products and staking?

Structured products are financial instruments that combine multiple options to allow investors to adjust various terms (such as maturity or target price) in order to achieve different payoff scenarios. In contrast to Proof of Stake (POS) mechanisms, which offer fixed interest rates on a fixed currency, structured products are much more flexible, and can offer higher potential returns in a volatile market.

Staking involves depositing digital assets into a blockchain network's wallet to support the security and operation of the blockchain in return for rewards. While staking offers an alternative way to earn returns on digital assets, it is restricted to POS system currencies and is exposed to risks such as forfeiture, malicious attacks, and more.

Note: Our structured products are written on mainstream digital currencies such as Bitcoin (BTC) and Ethereum (ETH).

Is VETA using structured products to bet against clients?

VETA is not betting with users. Rather, VETA serves as a provider, creating and offering the product while supporting investors with risk management throughout the purchasing process. VETA will actively disclose the full range of benefits and risks associated with the product.

What is "prepaid interest"?

The issuer of structured products deposits a portion of the interest payable to investors into a smart contract in advance. This interest grows over time and is automatically paid to investors at maturity, provided the conditions of the structured product are met. This setup allows investors to avoid the counterparty credit risk associated with product interest.

How do I use margin to purchase products?

Under the margin purchase mode, VETA provides investors with different purchasing quotas based on different underlying assets such as USD stablecoins, BTC, and ETH. Investors can use these quotas to purchase products listed on the platform. The margin required (i.e., the quota that is used up) varies with each product.

For example, if a snowball product has an opening margin ratio of 50%, purchasing $100 worth of the snowball will require $50 of margin, and the investor's available quota will decrease by $50.

To control risk, the platform sets a risk value to measure the current risk status of the investor. We recommend that investors keep the risk value below 60. If the risk value is between 0-60, the investor is in a safe state; if the risk value exceeds 80, there may be a risk of liquidation; if the risk value reaches 100, forced liquidation will occur.

How is APR calculated?

When calculating APR, we use the assumption of 365 days per year and a non-compounded yield. The formula is as follows:

APR = (Yield/Principal) / (Investment Duration / 365) *100%

Please note that this formula may not accurately reflect the actual returns on your investment, as other factors such as fees and market fluctuations can also affect performance.

Does VETA support multiple chains?

We currently operate on the Ethereum mainnet and do not have plans to expand to other chains at this time.

What is the minimum deposit amount ?

The minimum purchase amount varies by product. Please refer to the product purchase page for detailed information.

Are there any fees to use the VETA platform?

Investors using our platform do not need to pay any subscription or management fees, but a settlement fee is required to be frozen in advance (refunded in case of manual settlement). However, issuers of structured products need to pay a certain transaction fee, which is calculated based on 1.25% annual fee rate multiplied by the total value of the issued product. The specific calculation method for the transaction fee is as follows: 1.25% x product issuance amount x product duration days / 365.

Please note that certain investment products or services may incur additional fees. For specifics, please refer to our Fee Structure. VETA has waived the collateral pool fee and the transaction fee for investor buyers in its initial stage to benefit investors.

What is the VETA margin system?

The VETA Margin System aims to reduce counterparty default risk in structured products. This system ensures transaction security through a collateral pool, guaranteeing neither party will default. The VETA margin system enhances the security of investor funds, improves capital efficiency, and reduces transaction friction costs. To use the margin system, investors need to deposit assets into the collateral pool. Once assets enter the collateral pool, investors can use them to purchase structured products on the VETA platform. Investors need to regularly monitor the risk value in the collateral pool to ensure it stays within a reasonable range to avoid the risk of forced liquidation.

How are my collateral pool assets managed?

On the VETA platform, we use the assets in the collateral pool to generate additional returns. We place these assets on major lending platforms like AAVE and Compound to earn interest (for example, 2% for USDC). All returns are given back to the investors.

Who is eligible to issue products on the VETA platform?

According to therules of the VETA platform, anyone who meets the collateral pool risk requirements and has a capital scale exceeding $100,000 or equivalent can issue products. This means that you can not only be a buyer of structured products but also a seller.

Can I withdraw or redeem during the term?

No, partial or full redemptions are not allowed during the term. You can only redeem when the note comes to an end. Remember to click to select redemption on the product settlement day.

Has VETA been audited? Is there a security audit report?

VETA's smart contracts have been audited by a qualified audit company. We are committed to ensuring the security and reliability of our technology and will share the latest audit reports with our clients and stakeholders.

I don't understand some of the terms used for the products.

Please refer to our Glossary of Terms

I'm having problems using VETA.

Contact us on Twitter, and we will assist you.

I have more questions

Please refer to our official website.