uLABS Ideas: Building Decentralized Structured Products on UMA

In this article we show how popular structured products on centralized platforms can be built in DeFi using UMA’s infrastructure. We explain what Dual Currency Products and Principal Protected Products are and how they can be created using UMA’s EMP contract. Finally, we show how the two products are related and how they can efficiently be combined together. In traditional finance, structured products offer retail investors a passive way to access derivatives like exposure. Many of the popular structures allow investors to gain higher than normal yield by selling options embedded in the investment or obtain upside exposure to an asset with their principal protected. Similar structured products gained popularity in the crypto space with the dual currency product being one of the most talked about structures.