What the Index Coop Is Building In 2024 

2023 was a challenging year for our industry. Despite the high profile wrongdoing, stablecoin depegs, exploits, and fluctuating monetary policy, however, the Index Coop remained focused on building through the bear market.

In 2023 the Index Coop launched three new tokens: 

• Diversified Staked Ethereum Index, a diversified basket of top liquid staking tokens; and Gitcoin Staked ETH which has the same methodology but benefits public goods. 
• The Index Coop CoinDesk ETH Trend Index, a tokenization of CoinDesk Indices’ Ether Trend Indicator; 
• And the Index Coop Large Cap Index, a diversified large cap index of top cryptocurrencies and tokens, powered by 21.co wrapped assets.
  

We also built a new auction module and automated reweighting, published the first survey and annual report of the onchain structured product space,, and created a smart portfolio with eToro. Our products were also listed on Matrixport, Copper, Rhino.Fi and Argent and we received media coverage in Coindesk, Decrypt, Blockworks and The Defiant. 

With 2023 in the bag, what are we building in 2024? Well… lots. This year we have big plans to improve our protocol, launch new products, and make it easier for users to access Index Coop products.  

Finishing Index Protocol v1 then building v2

First, as part of our work on Index Protocol v1, we will:‍

Enable trust-minimized reweighting and auction rebalancing across Index Protocol products‍

Our product and engineering teams worked on developing trust minimized reweighting and auction rebalancing capabilities in 2023 with v1s deployed in January 2024. Our auction rebalancing module improves rebalance execution while eliminating much of the complexity and cost associated with traditional rebalancing. Rather than “take” whatever DEX liquidity is available, auctions enable a product to “make” liquidity available at specified prices, fundamentally changing how products rebalance on Index Protocol. By enabling liquidity providers or market makers to trade directly with a product, intermediary DEX dependencies are eliminated and incentives are better aligned. The result? NAV decay affecting index product holders is largely eliminated and operational costs for the Coop are drastically reduced. Extending these capabilities to more products built on Index Protocol is a major goal for 2024.

You can learn how to bid in our auctions and how the auctions work on our blog. You can learn more about the outcome of our first auction rebalance of dsETH, as well. Finally, if you’re interested in participating in auctions, and would like to speak with an Index Coop contributor, please contact institutions@indexcoop.com

‍Time for Index Protocol v2!

With the finishing touches being put on v1, it’s time to begin building Index Protocol v2 - which we are incredibly excited about. Broader diversification, enhanced decentralization, and improved product performance are guiding principles for Index Protocol v2 while new features like cross-chain compositions, RWA and NFT compatibility, and end-to-end product automation are actively being explored.

We aim to complete the research and early build phase for Index Protocol v2 in Q1 and Q2 of 2024, before launching parts of it in Q3 and Q4.

Do you have features or use cases you’d like to be included in Index Protocol v2? Let us know via: engineering@indexcoop.com. There are discussions happening about feature requests for v2 on X here and here.

‍Launch a Self-Serve Token Builder

‍Since our earliest days, we have heard from partners and users who would like to create their own onchain structured products. Internally, we have also wanted to launch and maintain products more efficiently with less reliance on engineering resources. To this end, we’ve begun working on a Self-Serve Token Builder, enabling us to increase our speed of launching and experimenting. Initially, our Self-Serve Token Builder will only be available internally and for select partners. However, once we feel the builder is ready for external users, we will open up access (we’re hoping by Q3 or Q4 2024).

Communicate your pre-release interest in the Self-Serve Token Builder by emailing: institutions@indexcoop.com.

‍Launching new products and improving $INDEX

New, upgraded leverage and inverse tokens on mainnet‍

In Q1 2024, the Index Coop product team is focusing on launching new leverage tokens on Ethereum mainnet to replace the legacy FLI tokens. These new tokens will be built on Aave V3 using Index Protocol's upgraded infrastructure. The legacy FLIs were built on Set Protocol which is no longer upgradeable. In addition to the battle-tested benefits for historical holders - such as automated rebalancing, liquidation protection, and persistent leverage - the new tokens will be significantly more gas-efficient to issue and redeem.

A suite of leverage and inverse tokens on Layer 2‍

In addition to replacing the mainnet leverage tokens, Index Coop plans to deploy a full suite of 2x, 3x, and -1x tokens on Arbitrum. Demand for leverage has grown tremendously across L2s like Arbitrum and Optimism, with much of that growth attributed to perp platforms; however, many of these platforms introduce significant complexity and cost for users. We believe that there is an opportunity for leverage solutions that are simple to use and cost a fraction of what users typically pay on perp platforms. A suite of leverage tokens allows us to do just that and also offer automated rebalancing, liquidation protection, and persistent leverage.‍

Composite products

Composite, thematic and sector-specific products such as a Layer 2 index, fundamentals-based indices, and other thematic indices are also under consideration for 2024. There is also potential for new ETH or stablecoin yield products, including a high-yield ETH product and an onchain private credit product.

Improving the $INDEX token‍

Over the last few years we’ve heard from $INDEX holders that they’d like the token to have more utility and we think it’s time to research this and potentially do something about it in 2024.

We are researching token utility and a range of use cases - including folks at some of our friendly VCs, such as 1kx, and in the $INDEX Insiders community (holders of our token and products) - before taking a range of legal and tax advice and then publishing a potential initial proposal to the forum. There are various compliance and regulatory considerations we’ll need to mind.

At this stage the research is quite broad, but if you have an idea you keen to push into this process please join our Discord and drop it in the #index-discussion channel. Ideas attracting the most attention at the moment include: stINDEX, index product productivity vaults and something called ‘Product Revenue Tokens’ (which entitle holders to future product revenue).

Improved access via a new app site and more integrations

A new Index Coop app, released in phases in 2024‍

In 2024, we want to come as close as possible to delivering on the promise of ‘one-click’ access to the most important themes in crypto. To that end, we’ll be refining and expanding our app functionality to provide users a more holistic financial experience. We’re building a few new pages/sections of the app right now, for release in the first half of 2024: a Products meta page, a leveraged tokens section and a Portfolio page.

Additionally, we aim to make it easier to engage with our dApp without needing a wallet by adding email sign in and an onramp, as well as enabling users to opt in to alerts via email and/or wallet messaging.

More value adding integrations and listings

In 2023, we landed partnerships with eToro and Matrixport, two leading centralized platforms offering digital assets to millions of users across the globe. In 2024, we’ll look to expand on those partnerships and increase the quantity and quality of our integrations, ensuring our products are more accessible for new entrants and capitalizing on a slightly less hostile crypto environment.

In 2024, we’ll also be looking to make $INDEX easier to buy and sell via two to three new Top10 CEX listings. Our listing at Coinbase, while very value adding, is less useful for folks in Asia, for example.

While 2024 is off to a good start for our industry as a whole, it remains to be seen how the rest of the year will unfold. We’re already seeing a post ETF downdraft, for example. However, whatever happens, the Index Coop will keep building towards its mission of simplifying access to risks and returns in the Internet Financial System.

If you’re interested in learning more about our work find us on Discord or Telegram. Or, reach out to our partnerships team at institutions@indexcoop.com.