Option Series Part IV - Economic Incentives for LPs• Pablo Bartol • 17 min read
This article analyzes liquidity, trading volume, capital efficiency, tokenomics, fees, and structured product performance and more.
Exploring the DeFi Perpetual Futures Landscape - Part I• Pablo Bartol • 18 min read
DeFi Perpetuals Landscape 2023
Arithmetization in STARKs Series Part III - Degree Bounds and Computational Complexity• João Farinha & Tiago Martins • 11 min read
This report compares the low-degree bounds of AIR and PAIR, specifically with proximity testing in mind.
Insurance Series Part III - Unwrapping Different Claim Assessment Types• Catarina Urgueira • 13 min read
This report deconstructs the existing claim assessment processes used in the DeFi Insurance space.
Arithmetization in STARKs Series Part II - Preprocessed AIR• João Farinha & Tiago Martins • 12 min read
In Part II of our Series on Arithmetization Methods for STARKs, we describe the construction of PAIR in the general case of multiple disjoint constraints.
Insurance Series Part II - Exploring Premium Pricing and Risk Models for Insurance• Catarina Urgueira • 20 min read
This article looks at the inner workings of the pricing models and risk used by the different protocols.
Arithmetization in STARKs Series Part I - An Introduction to AIR• João Farinha & Tiago Martins • 12 min read
Arithmetization of computational integrity statements into polynomial constraints with known degree bounds, for use in STARKs with low-degree proximity testing.
Insurance Series Part I - An Introduction to DeFi Insurance• Catarina Urgueira • 20 min read
This report provides a historical overview of the DeFi Insurance space, compares the sources for underwriting capital, and explores the existing cover types.
Deriving Impermanent Loss Formula in Balancer• Rúben do Reis • 14 min read
Decentralized exchanges, specifically automated market makers (AMMs), play a crucial role in the DeFi ecosystem.
Volatility Series Part II - Applying GARCH Models to Crypto Assets• Carolina Goldstein & Joana Gomes • 14 min read
In the first part of our article, we explored the nature of volatility and its importance in the context of cryptocurrency markets. We also emphasized the
Volatility Series Part I - Modeling Volatility in Crypto Assets• Carolina Goldstein & Joana Gomes • 16 min read
The crypto market has been subject to significant turbulence, as evidenced by events like the market crash in May 2021, which caused its market cap to drop
Neferpitou: Three Sigma’s Agent-Based Simulation Framework• Carolina Goldstein & Andreia Pereira • 10 min read
Diving into the world of agent-based modeling since early 2022, we at Three Sigma have been working to address a crucial gap in the blockchain industry.
Option Series Part III - Navigating Through Options Collateralization• Pablo Bartol • 16 min read
In this third article we will look at option collateralization, specifically the margin and liquidation engines of the protocols that allow leverage option
On Tokenomics Series Part II - The Game of Supply and Demand: The Demand• Carolina Goldstein & Joana Gomes • 12 min read
This is the second part of a two-part blog post about how supply and demand affect token design. The first part explained how to match the project's goals
Options Series Part II - Exploring Different Pricing Approaches and Tokenomics• Pablo Bartol • 15 min read
This second article will look at the inner workings of pricing, especially the violations of the Black-Scholes Model (BSM), which is the most commonly used
On Tokenomics Series Part I - The Game of Supply and Demand: The Supply• Carolina Goldstein & Joana Gomes • 14 min read
Tokenomics, or the study of how tokens are created, distributed, and used within blockchain protocols, is a crucial aspect of the cryptocurrency and blockchain
Options Series Part I - An Overview of the DeFi Options Landscape• Pablo Bartol • 20 min read
DeFi Options have become a highly sought-after product. However, compared to centralized counterparties, DeFi remains a small
Challenging Periods Reimagined Part II - The Key Role of Sequencer Decentralization• Daniel Fonseca & André Pereira • 20 min read
Challenging Periods Reimagined Series: Part II proposes decentralized sequencers with adjusted governance and incentives for improved Optimistic Rollups.
Distributed Automated Market Makers (dAMMs)• Tiago Fernandes • 15 min read
Capital efficiency has become a major concern for L2 solutions as DeFi continues to grow since liquidity is divided between L1 and multiple L2s.
The SVB Collapse: A Wake Up Call for Better Risk Management• Carolina Goldstein & Joana Gomes • 5 min read
Circle, the company behind the USDC stablecoin, acknowledged on Friday to having a $3.3 billion exposure to the now collapsed Silicon Valley Bank (SVB).
Challenging Periods Reimagined Series Part I - Road to a Dynamic Challenging Period• Daniel Fonseca & André Pereira • 25 min read
This article proposes a dynamic model for optimistic rollups' challenging period, having a minimum of 23h to minimize risks.
Investment Thesis: Arrakis Finance• Pablo Bartol • 12 min read
Arrakis acts as a decentralized market-maker where users have their liquidity managed through Arrakis, and projects can create deep liquidity for their native
Working with Three Sigma: A Q&A with the Yeti Finance Team• Pedro Santos & Carolina Goldstein • 5 min read
Yeti Finance was one of the first projects Three Sigma worked with, and we are very fond of the long-term partnership that developed over the duration of the
The Hitchhiker's Guide to DeFi Insurance• Carolina Goldstein & Catarina Urgueira & Tomás Thor Palmeirim • 120 min read
Since the early days, the DeFi market has been severely shaken by hacks, bugs, exploits, rug-pulls, flash loan attacks, and a long list of attack vectors,
Investment Thesis: Insrt Finance• Tomás Thor Palmeirim • 7 min read
Insrt Finance is building a layer of simplification and abstraction for NFT finance, aggregating yield-generating strategies into Yearn-like user accessible
Introducing: Three Sigma• Afonso Oliveira & Tiago Barbosa & Eduardo Morgado • 6 min read
The crypto/web3 industry has demonstrated how much it benefits from technical expertise and how far it still is from reaching its full potential.