What are Powers

Power Perpetuals are a derivative form of perpetual futures that provide global option-like exposure. Powers are indexed to some power of an underlying asset’s index price. The funding rate, instead of simply being

`mark — index`

now becomes `mark — index ^ P`

where `P`

is some power. In the case of SOL² (aka SQUOL), `P = 2`

and the underlying is SOL squared. The easiest way to understand it is if the price of SOL 3x’s, then the price of SQUOL 9x’s.We say that Powers provide option-like exposure because of the convexity of the payout. When prices move in in your favour, you earn a lot more than you would lose if prices move against you.

Things you can do with powers:

- Hedge impermanent loss from LP positions
- Hedge any vanilla option with the same underlying asset
- Construct automated vault strategies

This page is under construction 🏗

In the meantime, you can read Dave White's original power perpetuals whitepaper to learn more about power perpetuals.

Last modified 3d ago

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