What is the Methodologists Role?
Index Methodologists are data providers which publish research and data on compelling Index strategies. In general, an Index Coop product should:
- Be well differentiated from existing Index Coop products
- Target a sufficiently large market to be meaningful to the Index Coop
- Do an on-chain liquidity analysis for underlying collateral assets
- Have a complete methodology
- Potentially commit to a liquidity contribution for bootstrapping
- Potentially commit to marketing and distribution efforts
- Keep all documentation related to the index up to date, tracking performance and sending out updates monthly/quarterly/yearly as appropriate
- Publish reports in conjunction with marketing on Index Coop, your target market, competing products, and strategic initiatives related to your index.
Methodologists for accepted products are incentivized in two ways:
Beginning two months after Index Coop's launch, a methodologist bounty comprising of 7.5% of all INDEX tokens will be distributed over an 18 month period to all methodologists publishing data for active Index Coop Indices.
Each Index Coop index may have an associated streaming fee. This streaming fee is typically split between the Index Coop and the Index Methodologist. This fee is denominated in the index itself.
Index Methodologists like DeFi Pulse are not administrators of indexes created by the Index Coop.
In an analogy to traditional finance an Index Methodologist would be similar to State Street which provides data on the S&P 500 composition while the Index Coop would be similar to Vanguard which licenses & implements the S&P 500 in its Vanguard S&P 500 ETF product.
The working relationship between 3rd party Methodologists and the Index Coop is as follows:
- The Index Methodologist independently researches & creates an index strategy.
- An interested community member presents the methodology to the Index Coop for consideration.
- If the Index Coop decides the index strategy is valuable and effective, it may vote for the Coop to create a product which by convention will follow the proposed methodology.
- An Index Methodologist may be given a portion of streaming fees for the research and creation of their Index strategy.
- Keep track of the latest developments in areas relevant to the Index, proposing additions/deletions to the community and taking action on the voting outcome
- Stay visible to index holders and Coop members to answer questions and act as a single source of the truth in relation to the specific index
- Respond to questions on the forum and discord relating to your index
Last modified 1yr ago