Concept

Token DeFi (TDEFI) is a token basket that consists of the cryptocurrencies of leading and promising decentralized finance (DeFi) projects, protocols, and applications. It is a thematic token basket that capitalizing in its functioning and performance on multiple cryptocurrencies. A token basket (also, crypto basket) is a bundle of crypto assets (and tokens) designed to provide diversification, manage risk and simplify crypto/ token investing. Token baskets allow crypto investors to purchase and hold a basket consisting of multiple coins and tokens that operates as a single token. Baskets are traded as such for the purpose of diversifying token portfolios and managing their various risks (particularly, the risk of concentration or exposure to one token class).

Purpose

A token is a representation of an on-chain or off-chain asset. The basket (token DeFi) is created as per certain weights of component tokens, that can be invested and traded as one unit. Token basket trading allows token holdings diversification in the sense that investors can track a collection of individual tokens in a single basket. With that mechanism, investors can ensure that their portfolios are well tracked and diversified, with the possibility of gaining higher returns and spreading out the accompanying risks. For retail investors and new entrants, token baskets represent an easy way to construct and track their token/ crypto portfolio.

Methodology

Basket trading involves buying and selling a collection of digital assets bundled up into a single token. The component assets operate under a common theme or features, and therefore token portfolio allocation would be easily implemented and straightforward. The theme, in other words, dictates the composition of the basket. Examples of common themes include utility, type of project, or market capitalization. Accordingly, digital assets can be classified according to a factor or set of factors depending on the intended market exposure. For instance, a token basket may be designed to give investors exposure to largest tokens in terms of capitalization or the best-performing ones over a certain time span.

The weights of the tokens (e.g., cryptocurrencies) in the basket are reconsidered and recalculated at the end of each quarter of the year according to market conditions and price development (and the effect thereof on basket components). The weighted value of the tokens in the basket varies according to current market prices. Token DeFi (TDEFI) basket token offers investors the opportunity to buy and sell a bundle of cryptocurrencies with a single transaction. In this way, it minimizes the need for holders to constantly track each token, while having the ability to constantly support the growth of the portfolio. TDEFI cryptocurrency basket token has many advantages over other cryptocurrencies due to its dynamic structure and market responsiveness, including easy buying and selling, low cost, and portfolio diversification.