Take a look at how it works first.
What is Dual Currency Yield?#
Dual Currency Yield is a non-principal-protected product, and your yield currency depends on whether the expiration price is higher or lower than the target price.
Using BTC as an example:
- High sell BTC
Choose your target price. If BTC does not rise to the target price at expiration, you will earn BTC yield. If it rises to the target price, you will successfully sell the currency at the target price and earn additional USDT.
- Low buy BTC
Choose your target purchase price. If BTC does not fall to the target price at expiration, you will earn USDT yield. If it falls to the target price, you will successfully buy the currency at the target price and earn additional BTC.
I asked ChatGPT, and it started talking nonsense. As soon as humans think, ChatGPT laughs.
Let's do some calculations.
Coin-based (More coins means winning)#
For example, I have one BTC with a cost of 30,000.#
Product Name: Sell at a high price of 31,000 in coin-based
Scenario 1: When the price is equal to or higher than 31,000, you are basically guaranteed to lose money or accept the fact that you will receive U-based currency without any fees. From another perspective, this financial product can help you sell at the expected psychological price without any fees. You will bear the risk above the target price yourself. If it gives you 31,000, even if it eventually rises to 32,000, you will bear the 1,000 in between. In reality, you can only buy back 31,000 / 32,000 = 0.968 BTC.
Scenario 2: When the price is lower than 31,000, you win and get a profit of 1.05 BTC based on coins.
U-based (More U means winning)#
For example, I have USDT equivalent to one BTC with a cost of 30,000.#
Product Name: Buy at a low price of 29,000 in U-based
Scenario 1: When the price is equal to or lower than 29,000, you are buying at a low position, and the coin-based currency comes out. You bear the risk below the target price yourself. For example, if BTC continues to fall to 28,000, you miss the 1,000 U space in between. Instead of getting 1.073 BTC, you can only get 1.034 BTC in the end. You lose 0.039 BTC.
Scenario 2: When the price is higher than 29,000, you win and get a profit based on U.
Where is the risk?#
When the index price deviates from your target price, you need to bear all the risks. The settlement period is from 1500 to 1600 UTC+8. There is an additional two-hour delay until the settlement time, and the risk of delay is unlimited. In fact, this product is very suitable for sideways currencies and immediately determines the result at the time of settlement, hedging the risk exposure for 2 hours.
What is the conclusion?#
If you want to sell your coins without pain and take the maximum profit, you can choose to sell at a high price and achieve near-maximization of benefits. The worst result is regret, but please remember that selling high is always profitable.
However, if you want a macro eternal coin-based/pie-based approach, carefully choose to sell at a low price for arbitrage, because there is a chance of being left behind. Currently, mainstream dual currency yield financial products in the market control the prices very narrowly. If you go out of the range, you will suffer the pain yourself.