Transforming The DeFi Ecosystem Is EcoChain’s Capital Logic

What Is The Stand Of DeFi? 

Now arguably the most discussed topic, decentralised finance (DeFi) has taken the blockchain network by a storm. The DeFi network has grown enormously in size and number although it has been a roller coaster ride. The total value locked in DeFi contracts is more than $11b, today. Forex

Market Alone Is More Than $6 Trillion

Mostly bordering around profitability and ease, DeFi’s growth and hype can be attributed to several reasons. Allowing users to utilise traditional banking services like credit systems, saving, investing in a peer-to-peer permissionless protocol, which is usually Ethereum is essentially DeFi or open finance. Open finance is a careful attempt to eliminate third parties and intermediaries while offering traditional financial services, most importantly

There are many similarities in the model, although DeFi can never compare to traditional finance in size, which is the forex market alone is more than $6 trillion in size. Practically a cash flow/circulation cycle, DeFi’s fuel is volatility. There’s still a lot to learn from traditional finance in hedging, logic theories, behavioural finance, and economics as a whole while DeFi has rebranded saving, investing, and most importantly borrowing and lending models. Many DeFi protocols have not focused on risk management and variation around the expected value as the reality is. 

ECOC DeFi Ecological Capital Model

Making hedging of DeFi returns more efficient, the ECOC financial growth token (EFG) comes as a unique DeFi protocol model that factors user and price behaviours, volatility. While the seller has short volatility, the EFG token buyer has the advantage of long volatility. Both the seller and buyer can exploit the volatility to make additional gains during the hedging period if the underlying ECOchain increases volatility during the period. 

ECOC DeFi Ecosystem Logic Composition

In evaluating price and technical analysis, investors often drift between the BSV model and the Unified theory model. As a case study let's take the BSV model. There are two reasons for making wrong investment decisions, as the BSV model argues; an impulsive focus on recent data changes while neglecting the change’s overall cause is the first reason.

Being exact the opposite, a complete focus on forecasting tools while ignoring recent data changes is the second reason. To allow for accurate technical and fundamental analysis the ECOC DeFi ecosystem model accurately presents the investor with predictive and ever-changing data. 

The Combination Of Theoretical Data

It was also observed that under the multi financial factor those pricing models that include the Arbitrage pricing theory, optional pricing theory, capital access price model, and modern portfolio theory, lets us examine the EFG and ECOC ecosystem. 

Arbitrage pricing theory (APT): 

This theory opines that an asset’s return can be modelled as a linear function of many macro-variables and the initially expected asset return was proposed by Stephen Ross in 1976. This theory of asset pricing thereby does accommodate unexpected events and risks of asset investment virtually. For example, it would be a macro-variable or an unexpected event when it comes to a pandemic. To help investors manage risks and accommodate macro-variables, EFG’s ecosystem uses a single-factor model with CAPM combination. Investors make a completely informed decision on the asset in this way. 

Optional pricing theory (OPT): 

Using multiple variables in valuing an option is the optional pricing theory. Calculating the probability that an option will be exercised at expiration is essentially what OPT does. Estimating the likelihood that EFG hedging collateral data will be exercised or be in the money within the price at maturity and as expected, is EFG’s optional pricing theory. A fair theoretical price can be determined for the EFG token by extrapolating from underlying variables including asset prices and expected time. 

The capital asset pricing model (CAPM): 

Used to determine an asset’s return rate over some time is this theoretically. Encouraging momentum traders’ participation, EFG’s CAPM data analysis provides users with dependent stable data. 

Modern Portfolio Theory (MPT): 

The focus of MPT is maximising returns against risk. Providing a two-way portfolio that supports risk management while maximising asset returns is EFG and ECOC’s average variance analysis. 

Here We Conclude The Discussion 

ECOC financial growth token has shown its commitment to continue providing data analytic tools to investors as of course there is a wide range of parallels between open finance and traditional finance. Facilitating trust in the DeFi ecosystem as a whole, they also bridge the gap between mid-level enthusiasts.  

So, while we watch ECOC, there is more to be learned from this DeFi giant. It’s goodbye from us until we return with more details.