Bankless Alpha Leak | The Bull Case for Lyra
May 18, 2022
Mike Spain, Co-founder of Lyra, dives into the revolutionary world of on-chain options trading during a vibrant discussion. He shares the origins of Lyra and its evolution amid the DeFi boom. The highlight is Lyra's new Avalon upgrade, which enhances trading flexibility and efficiency. Mike also discusses the unique challenges of options trading, the importance of Layer 2 for scalability, and the innovative features that make Lyra a key player in DeFi, emphasizing community engagement and sustainable yield opportunities.
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Lyra's Genesis
- Lyra's co-founder, Mike Spain, worked at Synthetix during DeFi summer in 2020.
- While derivatives like perpetuals gained traction, options remained largely untapped due to high gas fees on L1.
Options as Risk Management Tools
- Options enable risk transfer between buyers and sellers, crucial for market participation beyond speculation.
- This allows non-speculators, like farmers, to manage risk, essential for broader market adoption.
L2 Necessity for Options
- On-chain options require computationally intensive operations, exceeding Ethereum L1's capacity.
- Lyra leverages Optimism Layer 2, which offers lower fees and increased transaction speed.