Volatility is a part of any market, and the Crypto Volatility Index or CVI brings a new set of tools to an evolving sector of the global financial markets. The past few years have seen a wide range of new tools emerge in the crypto space – but one has been lacking.
A volatility index is a vital part of any financial market, and the CVI does a great job of creating a gauge for measuring the forward-looking expectations for volatility in the crypto markets.
In truth, the CVI is a lot more than a simple volatility index. It is a new liquidity ecosystem that offers $GOVI token holders a say in how the platform is governed, and also offers returns for liquidity providers.
The CVI is Here!
Volatility is the core of any market, but until now, there hasn’t been a dedicated metric to measure crypto market volatility. Much like the VIX, which measures the expectations for volatility in the S&P 500, the CVI measures a range of popular crypto assets.
It is important that a volatility gauge has a wide range of assets, especially in the crypto markets, as many tokens move quickly and in large percentage terms.
Instead of focusing on a few tokens, the CVI is based on the Black-Scholes option-pricing model and uses a broad base of both exchanges, and token to create a reading of between 0 and 200.
In addition to offering a great tool for traders and investors, COTI, the company that created the CVI, also created the $GOVI token that makes the CVI ecosystem work for everyone involved.
$GOVI Makes Sense
COTI created the $GOVI token with open source ideas in mind. The token is based on ERC-20 architecture and is used for a number of purposes in the CVI ecosystem.
The $GOVI token is used for platform governance, and allows holders to vote on how the CVI is structured, and also can be staked to gain rewards in the form of sharing platform fees.
Like any ERC-20 token, $GOVI is freely tradable and can be used as a means of payment with anyone that sees value in the…