The Metaverse Index (MVI) is designed to capture the trend of entertainment, social activity and business moving to take place in virtual economies, powered by NFTs and blockchain technology. The MVI uses a combination of the square root of market cap and DEX liquidity to arrive at the final index weights.
Specification
The Metaverse Index methodology weights tokens in the index according to their market cap based on circulating supply and available liquidity. The index weight is calculated using a combination of square root market cap and liquidity weighting to arrive at the final index weights. The index weighting can be calculated as
TW = (0.75)*RMCW + (0.25)*LW
where,
TW = token weight in the $MVI
RMCW = square root of market cap weighted allocation
LW = liquidity weighted allocation
Token Inclusion Criteria:
Selection of the $MVI tokens would be based on the following basic criteria:
The Metaverse Index considers a wide range of characteristics that can be placed in four dimensions. Two dimensions are used to evaluate the token’s characteristics, one dimension is used to assess the project’s characteristics, and one is used to evaluate the protocol’s characteristics. The inclusion criteria are the basis to select what tokens will be included in the index.
Token’s Descriptive Characteristics
Token’s Supply Characteristics
Project’s Traction Characteristics
Protocol’s User Safety Characteristics
Implementation
The Metaverse Index is implemented on Set Protocol on the Ethereum mainnet
The index is maintained quarterly (in January, April, July, and October) in two phases:
Determination Phase. The determination phase takes place during the third week of the rebalancing month. It is the phase when the changes needed for the next reconstitution are determined.
Circulating Supply Determination: The Metaverse Index currently references CoinGecko’s circulating supply number. The Circulating Supply is also determined during the final week of the quarter and published before the reconstitution. Additions and deletions: The tokens being added and deleted from the index calculation are determined during the last week of the quarter and published before the reconstitution.
Reconstitution Phase. The index components are adjusted, added and deleted as per the instructions published after the end of the determination phase. New index weights, additions and deletions are incorporated into the index during the monthly reconstitution, which will take place on the first business day of the month. As assets tracked by the index grow, the reconstitution window will expand to more than one day to lower the reconstitution’s market impact.
Streaming fee: 0.95%
Mint fee: 0%
Redeem fee: 0%
The following risks may apply to this digital asset: full or partial loss of digital assets due to technical hacks, exploits, or failures that may occur at the protocol or smart contract level of a product’s infrastructure; restrictions placed on the digital assets by regulatory authorities in the end users region; loss of digital assets or loss of access to the digital assets due to decisions made by centralized providers of the underlying assets; full or partial loss of digital assets through standard product operations which can be hampered by unexpected market conditions; full or partial loss of digital assets due to changes to underlying product assets made by the originating protocols; full or partial loss of digital assets due to volatility, correlation, value at risk, and contagion risks; underperformance of digital assets due to deviation from intended methodology; full or partial loss of digital assets due to the volatility of underlying tokens.
$MVI is an index product released in 2021 that aims to encompass the trend of entertainment, sports, and business shifting to take place in virtual environments. Index Coop’s first community-built product.
Madison Sinclair
February 16, 2022