Index Coop Statement on Recent Events
The collapse of centralized exchange FTX.com this week has shaken the cryptocurrency industry.
November 9, 2022
Markets are trading down, and many are suffering steep losses. You can read an overview of what happened from Coindesk. Our thoughts are with those who have been impacted by these events.
For those who hold INDEX or our strategy tokens, we want to make it clear that Index Coop has no connection to FTX. Our balance sheet does not have any exposure to FTT or assets custodied by FTX, and Index Coop operations will not be affected by recent events.
We'd also like to take this opportunity to articulate what separates DeFi, Index Coop and our products from centralized actors like FTX:
- All of our assets are self-custodied. We do not have the ability to move, alter or otherwise transact with user’s funds. Users always have the ability to permissionlessly withdraw their funds.
- Our products are fully on-chain and transparent 24/7. Product holders can view their holdings at any point with proof of collateral. Proof of reserves are guaranteed and are not manually reported but rather available on-chain for anyone to audit.
- Automated risk management is built into our products via smart contracts. Diversification is a reliable risk management practice meant to protect assets during turbulent times. Many of our products have automated risk management built-in rebalancing and reweighting, automatically preparing our users for the most turbulent market changes.
- We clearly and transparently acknowledge risks. As with any digital asset, our products are not without risk. We acknowledge the risks associated with owning our products on each of our product pages on our website.
- Index Coop operations are not impacted by recent events. Our treasury holdings are self-custodied on-chain, and not exposed to CeFi risks. Our treasury is made up overwhelmingly of stablecoin and low-risk stablecoin yield positions.
This is a challenging moment for our industry. Many are disheartened by the apparent lack of risk management and irresponsible business practices at Alameda and FTX. And the effects of these events are still playing out.
Despite the challenges of this year, and this past week in particular, we remain optimistic about the future of true decentralized finance. Index Coop and our partners across DeFi remain committed to building a permissionless, on-chain, fully decentralized financial system.
Disclaimer: This content is for informational purposes only and is not legal, tax, investment, financial, or other advice. You should not take, or refrain from taking, any action based on any information contained herein, or any other information that we make available at any time, including blog posts, data, articles, links to third-party content, discord content, news feeds, tutorials, tweets, and videos. Before you make any financial, legal, technical, or other decisions, you should seek independent professional advice from a licensed and qualified individual in the area for which such advice would be appropriate. This information is not intended to be comprehensive or address all aspects of Index or its products. There is additional documentation on Index’s website about the functioning of Index Coop, and its ecosystem and community.
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