CAI, or Colony Avalanche Index, is an investment tool to benefit from the growth of the Avalanche ecosystem as a whole through just one token. The CAI is a basket of both AVAX and Avalanche application tokens, spread into different thematic sections for DeFi, GameFi and others.
In addition, thanks to an integration with Yield Yak, the CAI token is natively yield-bearing. The assets inside it are deployed to earn additional yield through the aggregator, offering a safe but effective way to compound gains.
CAI is designed for investors who are excited about the Avalanche ecosystem but prefer to gain exposure in a calculated, more efficient way that optimizes capital for them. The network is a mere 22 months old, but it is already the third largest DeFi ecosystem by total value locked, in addition to very successful GameFi projects like DeFi Kingdoms, which run on their own subnets. The ecosystem will continue to grow and evolve rapidly, making it difficult to pick the ultimate winners at this stage.
To account for the dynamism of the Avalanche Ecosystem, CAI will rebalance every month to always include the top assets by liquidity and capitalization. The dynamic rebalancing methodology ensures that CAI always stays allocated in the best-performing assets.
At the same time, CAI offers all the benefits of index investing. Diversification means that buyers aren’t strongly affected by specific events that tank the price of one individual token. It also offers a convenient way to maintain discipline, as time in the market often beats timing it. The additional yield utilizes the best of Avalanche’s yield protocols to improve returns for investors.
The timing for CAI’s launch is excellent as the Avalanche ecosystemm readies for more explosive growth. Despite the wider market downturn, Avalanche continues to lead in terms of innovation and user growth. Projects like Platypus, Trader Joe offer exciting innovation, while subnet-based games like DFK, Crabada and many others are seeing massive activity that rivals the EVM-compatible Avalanche C-Chain itself.
“Index investing is a very convenient way to cut out the noise and ride the trend. If you believe in the Avalanche ecosystem, CAI represents the best possible way to get passive exposure to it. Individual projects may come and go, but the ecosystem stays — with CAI, we’ll take care to always keep the most relevant composition of popular assets,” said Elie Le Rest, CEO at Colony Lab.
“In traditional finance, approximately 18% of the equity market is held in index funds. The same can’t be said for the crypto space. Yet. As crypto adoption soars, so too will the demand for passive investment tools, which help investors gain risk averse, simple-to-use and time-efficient access to the best performing projects. CAI delivers this for investors in the Avalanche ecosystem.” said Charles Storry, co-founder at Phuture.
Colony is a community driven accelerator, evolving into an inclusive DAO, to boost Avalanche’s ecosystem growth.
Colony deploys capital within Avalanche on early stages projects, provides liquidity to DeFi protocols, validates networks through stacking capabilities and maintains an index (CAI) on top Avalanche projects. The true sustenance and value generated by Colony’s investments is routed back to the community through airdrops, a buyback mechanism, and staking rewards.
Phuture (PHTR) is a decentralised crypto index platform that simplifies investments through automated, themed index funds on Ethereum and Avalanche. Phuture has launched the Phuture DeFi Index (PDI) and recently released the Colony Avalanche Index (CAI). Founded in 2019, Phuture has raised USD 3.75 million.
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