Dual Investment Overview

The Dual Investment vault is ProdigyFi’s flagship product, which features a decentralized and high-yield vault centered around two specific token.

In short, Dual Investment enables users to buy or sell a token at a specific target price (linked price) on a specific date (expiry date), all while earning boosted and real yields regardless of market movement.

Here’s how it works:

• The vault focuses on two specific tokens, such as a stablecoin and a cryptocurrency (e.g., USDC and BTC).

• Users can deposit token X into the vault and wait for the linked price of token X to hit. If token X hits the linked price on the expiry date, token X will automatically swap into token Y and the user will receive token Y.

• While waiting for the market to reach the linked price, users earn yields on their deposits, regardless of whether the swap is executed.

In essence, the vault combines earning passive yields with executing a strategic trade, all in a decentralized environment.

Mechanism

The Dual Investment product on ProdigyFi operates through decentralized vaults, each with specific parameters like yield opportunities, linked prices, and expiration dates. Here's how the lifecycle of a vault unfolds:

1. Vault Creation

Any user (Vault Creator) can create a vault by setting the vault parameters such as token pair, direction, linked price, yield, expiry, and quantity. The Vault Creator also provides the necessary liquidity to fund the vault. This action automatically generates a smart contract for the vault and lists it on the platform for discovery.

2. Vault subscription

Other users can find the vault in the "Earn" section and filter based on their preferred token pair and direction (Buy Low or Sell High). The vaults will come with their own expiration date, APY, and linked price.

• Buy Low: This vault enables users to buy the token (e.g., WETH) at a linked price lower than the current market rate, with the added benefit of earning yields on their deposit while waiting for the vault to expire.

• Sell High: This vault enables users to sell the token at a linked price higher than the current market rate, with the added benefit of earning yields on their deposit while waiting for the vault to expire.

3. Earning Yields

Vault subscribers earn yields based on the rate set by the Vault Creator. This yield accrues until the vault reaches its expiration, providing a yield on the deposited capital regardless of the market outcome.

4. Expiration and Settlement

When the vault reaches its expiration date, the smart contract automatically retrieves the last posted market price for the base token from our pricing oracle at the designated expiration time (16:00 UTC+8).

Based on the vault's direction ("Buy Low" or "Sell High") and the linked price, the smart contract determines the settlement.

*We currently use Pyth Network & Chainlink oracles.

5. Fund Distribution

After expiration, the smart contract distributes the settled funds to both the Vault investor and the Vault Creator, making them available for withdrawal.

6. Withdrawal and Completion

Once all funds have been withdrawn, the vault is considered "settled" for all participants.

(Optional) Liquidity Adjustment:

The Vault Creator has the option to withdraw any remaining, unused liquidity from the vault at any time. This action removes the vault from the “Earn” page, preventing further vault subscriptions.

However, all existing vault subscriptions are honored and processed according to the vault's terms on the expiration date.