GM Index (GMI)

What is the GM Index?

GM Index (GMI) is an index protocol that allows users to invest in a basket of assets by interacting with the protocol's Index contract. It manages various assets, calculates their weights, and allows users to mint, burn, and redeem index tokens.

What tokens make up the GM Index?

The current index assets are gmBTC, gmETH, gmSOL, and gmUSDC-USDT-SWAP.

What are GM tokens?

GMX is a Decentralized Perpetual Exchange. GM tokens are the liquidity provider tokens for GMX's V2 markets. The GM tokens accrue a large percentage of the V2 markets generated fees. You can read more about them here.

Can tokens be added or removed from the Index?

Yes, the Admin can add new tokens or remove existing ones, with accompanying weight adjustments. Ample warning will be given ahead of token changes.

How can I check the current composition of the GMIndex?

The bottom of the main GMI page displays a live breakdown of the assets that make up the index.

How are the token weights determined?

The index periodically undergoes optimal rebalancing via a proprietary algorithm that enhances the risk/return ratio of the basket of assets.

How can I mint index tokens (GMI)?

Users can "mint" GMI tokens by depositing one of the supported GM assets into the Index. This is done via the "Deposit" tab on the main GMI App page. The number of GMI tokens that are minted is determined by equivalent ratio math.

A simple example would be if your GM asset deposit value is 2% of the total GMI token value in the Index, then you would mint and receive an amount of GMI that is equivalent to 2% of the total GMI token supply.

How do I get GM tokens?

See the instructions from GMX. You can buy GM tokens here.

Do I have to use GM tokens to buy GMI?

It's your lucky day. You can also use USDC to buy GMI. If you select USDC in the Deposit dropdown and enter an amount, our code in the background calls the GMX contracts, buys GM tokens (the Index contracts determine which GM asset is furthest away from its target weight and buy that one), deposits them into the Index, and withdraws GMI to your wallet, all in one click of a button.

How is liquidity managed in the GMIndex?

GM Index tokens are deposited into Token Bank contracts. These contracts hold the underlying GM assets, acting as the source for deposits and withdrawals.

Can I exchange GMI tokens to redeem underlying GM assets?

Yes, users can click on the "Withdraw" button on the main GMI App page. This effectively burns their GMI tokens, and they receive the equivalent value (minus fees) of the burned GMI tokens in the GM asset they chose to sell the GMI for.

Note: There must be sufficient liquidity in the market token that you are wanting to receive. If there is not, you need to wait for other providers to deposit more of the specific GM token. You can also pick another GM token to withdraw or split the withdrawal into multiple GM tokens.

What are the fees?

The Index fees are as follows:

• The Minimum Fee is the minimum fee that is charged on each Index deposit or withdraw.

• The Base Fee is the nominal fee if the token you are depositing/withdrawing is at its target weight.

• The Base Tax is an increased fee for taking an Index token away from its target weight.

• The Protocol Fee is the percent of each fee (in GMI tokens) that goes to a Gloop-controlled address for future liquidity provision.

See Gloop Parameters for the current fee percentages. Also, you can go to the Fees section for further explanation.

How is the price of the GM Index token determined?

The total amounts held in the Banks of the underlying GM assets are multiplied by each asset's latest price (provided by oracles). These values are then summed into a total Index value variable. This value divided by the total GMI supply results in the current price of GMI.

What happens if the value of a token in the index changes?

When the value of a token in the index changes, the proportion of that token in the index may change as well. The index value will adjust accordingly based on oracle price updates.

What happens if an asset in the Index becomes illiquid or delisted?

The core team will ensure the Index is holding liquid and active tokens. If a token needs to be removed or replaced, ample warning will be given, and the Index algorithm will calculate a rebalancing of token weights. The Admin will set the new target weights in the Index.

How is fee revenue handled within the GM Index?

Fees generated are split into two buckets at percentages determined by the Admin within the contract. A portion is reflected back into the Index itself, resulting in higher GM token TVL, which buoys the price of GMI. The remaining portion goes to the protocolFeeRecipient wallet, which Gloop controls. This chunk will be used for USDC liquidity provision once the GM Lending/Looping Platform is launched.

How can I track the historical performance of the GMIndex?

The opportunity for a member or two of the Gloop community to create a Dune Dashboard to track the historical price/performance of the Index is open. We would be very grateful for this help!