Volatility Oracle

Markets with Off-chain data source

To provide reliable and market-driven implied volatility for traders on IVX, the protocol will depend on a built-in volatility oracles, associated with Laevitas.ch as the main data provider. This will push off-chain volatility indexes determined between multiple high liquid centralized option exchanges, to on-chain data pipelines in order price IVX option markets.

CEX option exchanges supported

• Deribit

• Binance

• Bybit

• OKX

• CoinCall

As the strike prices on IVX are compatible with the option exchanges, the volatility oracle will fetch the $Ask\_IV$ and $Bid\_IV$ and calculate the weighted average between the supported exchanges ensuring the following criteria:

• Deactivate any volatility feed which there have been no data updates for the last 1 minute

• Eliminate any volatility feed where the $Ask\_IV$ and $Bid\_IV$is 10%+ away from the median volatility across all volatility feeds.
• Terminate any options market with less than two valid volatility sources for the last 5 minutes

By that the index volatility for each side will be calculated as follows:

$\LARGE AvgIV(i) = \frac{{\sum (Notional\ Value(i)*IVfeed(i))}}{\sum (Notional\ Value(i)\\\\)}$

The price feed will be updated on chain every 15 minutes or every specific increase in IV percentage, this will be dependent on the activity of the token-supported