In the last few weeks, thousands of new users have joined The Risk Protocol, so here is who we are and what we are building. Every great market grows up the same way: it learns to trade an asset, then to lend against it, and finally to split the asset's risk and hand each piece to whoever wants it. Crypto has barely begun that last stage, the risk layer, and we are building it 🧵

ETH broke the floor. RiskOFF held its ground. ETH has fallen about 11% since our current RiskON/RiskOFF epoch opened on 26 September, as US spot ETH funds saw more than $1 billion in net outflows in October, already their heaviest month of outflows this year. Over the same stretch, RiskOFF ETH is down a little under 5%, and RiskON ETH is down about 18%. Both were split from the same ETH on the same day, so the gap between them shows exactly what each half is built to do. RiskOFF is the low-risk half, with a built-in floor 5% below where the epoch opens and a cap about 6% above it this epoch. ETH first slipped through that floor at $2,557 on 7 October, has stayed below it since 12 October, and has now spent almost half the epoch’s hours under it. Once ETH is below the floor, RiskOFF stops following it down, and its loss holds at 5%. RiskON is the leveraged half, and it carries the fall that RiskOFF does not, at about 2x beyond the floor. That is the trade it signs up for, because it also keeps about 2x of every move above the cap. Neither half is better than the other; they are two halves of the same ETH, built for two different views of where it goes next. This epoch settles on Monday at 00:00 UTC. Unless ETH rallies about 7% from here to get back above $2,557, RiskOFF ETH settles at its floor, 5% down, and Deribit activity puts the odds of ETH finishing below the floor at about 90%. A new epoch then opens with fresh strikes around Monday’s price, and both tokens start again at half the value of ETH each. So the question for ETH holders is how to hold it into the next epoch. If you expect more of this selling, RiskOFF keeps you in with a floor 5% below Monday’s open. If you think the selling has run its course, RiskON gives you about 2x beyond the new cap, with no funding, margin calls, or liquidations. If you cannot tell yet, hold RiskOFF through the uncertain part and rotate into RiskON as ETH climbs toward the cap. Test your hypothesis on app.riskprotocol.io and learn to use a new primitive before trading with real money as we build toward our mainnet launch.

More than 1,000 startups applied to the @token2049 NEXUS Startup Competition this year. The field narrowed to a Top 50, and The Risk Protocol was one of the 10 finalists who pitched on stage in Singapore last week. This comes off the back of our wins at Paris Blockchain Week and Arbitrum Open House earlier this year. Thank you to TOKEN2049 for the opportunity, and to the judges from @Dragonfly, @multicoin, and @MaelstromFund for their sharp questions. Between the pitch and our booth, the message resonated, and it was great to meet partners we will work with long-term. Tokenization is well beyond a buzzword now. In Singapore, it was what everyone was actually working on rather than just talking about, and most of that work is about bringing assets on-chain. Every one of those assets carries risk, and that risk is what we tokenize and make tradable. That is the Risk Layer of crypto we are building. The other thing we took away from the week is that crypto has moved from promises to proof: what matters now is real utility and real users. That is the bar we hold ourselves to as we build on @arbitrum, and more than 17,000 wallets already use our testnet every month, with over 4,000 active daily. Try it yourself at app.riskprotocol.io

Thank you @ArbitrumDevs. At Founder House London, the @Arbitrum team and mentors gave us valuable feedback; a few founder-level conversations turned into integration talks; and we took home the 2nd Prize. We are building the Risk Layer of crypto on Arbitrum, and next week we pitch it on the @token2049 NEXUS stage in Singapore. Good luck to @xLiquida and @bermudabayzk; see you there. If you are an early-stage team, Founder House Singapore will be worth it.