How CHAOS Works
Three simple steps to turn market volatility into consistent profit. No complex strategies. No emotional trading. Just math.
The Strategy in 3 Steps
A formally verified approach to profiting from market chaos.
Diversify Your Portfolio
Split your capital into three buckets: 50% volatile asset (BTC, ADA, ETH), 30% stablecoin (USDC/DJED), and 20% liquidity provision positions. This balanced allocation reduces risk from day one.
- 50% in volatile crypto asset
- 30% in stablecoin reserve
- 20% in LP positions for fees
Rebalance on Price Swings
When the volatile asset moves ±10% from target allocation, the protocol automatically rebalances by selling high or buying low. This captures the rebalancing premium from market volatility.
- Price rises → Sell high automatically
- Price falls → Buy low automatically
- Capture profit on every swing
Earn Continuous LP Fees
The 20% LP allocation generates consistent ~20% APY from trading fees. This creates a performance floor that protects against bear markets while the rebalancing strategy profits from volatility.
- ~20% APY from LP trading fees
- Creates a performance floor
- Works in all market conditions
Key Benefits
Mathematically proven advantages over traditional HODL strategies.
Bounded Drawdown
Maximum drawdown is mathematically proven to be ≤64% of the underlying asset drawdown. The stablecoin buffer and rebalancing mechanism limit losses.
Convex Payoff
The strategy gains from both upward and downward price movements. Volatility becomes your ally, not your enemy. More chaos = more profit opportunity.
Positive Expected Value
Formally proven to have positive expected value when asset volatility exceeds 25.5%. Transaction costs are more than offset by rebalancing gains.
Mathematical Guarantee
Every claim is backed by formal proofs in Lean 4. No assumptions. No handwaving. Just pure mathematics verifying that the strategy works as promised.