Bumper’s Breakthrough DeFi Protocol Set to Reshape Options Pricing

[PRESS RELEASE – London, United Kingdom, May 31st, 2023]

Marking a seismic shift in the digital asset landscape, DeFi platform Bumper today reveals the findings of their comprehensive simulation, which demonstrates new pricing efficiencies over traditional options. table before the launch of the protocol in August 2023.

This report describes a milestone in financial technology, showing a new financial instrument that consistently outperforms existing options desks in generating both competitive premiums and sustainable yields, backtested against real, multi Year history cryptocurrency market data and options prices.

The report is the culmination of a two-year Research and Development exercise powered by a $20m investment and obtained in collaboration with CADLabs and the Swiss Center for Cryptoeconomics.

Key highlights from the simulation report:

• On average, Bumper Takers paid 9.3% cheaper premiums than buyers of traditional put options.
• During the 2022 bear market, the Bumper simulation showed a yield increase of 46.2% for Creators compared to option pricing without the use of token incentives.
• The protocol remains solvent throughout the simulated conditions.
• Despite having different inputs and methods, Bumper’s results reveal a striking affinity with the Nobel Prize-winning Black-Scholes model.

These results are important in understanding and improving the stability of the Bumper protocol in different market conditions.

In releasing the report, Bumper CEO Jonathan DeCarteret stated, “By challenging and potentially changing the accepted rules of options pricing, Bumper stands to change not only the options market of crypto, but also has the potential to infiltrate traditional finance and disrupt the massive $13T derivatives market in the future.

The report highlights the anticipated outcome of dynamic Bumper pricing, based on forward volatility rather than conventional implied volatility.

The findings of the simulation report position Bumper as a hugely attractive prospect for institutions and fund managers, in addition to retail crypto investors.

The economic simulation report released today marks the most significant validation of Bumper’s new approach to date and heralds what may be one of the most significant challenges to the Black-Scholes pricing model in the mid- a century.

Read the Bumper simulation report here, and for more information on the protocol, visit https://bumper.fi.

About the Bumper

Bumper is a DeFi risk market that provides protection from price volatility of crypto assets. Users who buy protection (Takers) set a price at which they want to protect their crypto if the price falls, but they will not lose if the market rises. On the contrary, some users (Makers) get a yield by providing stablecoin liquidity to the protocol.