# Variational Protocol

> The decentralized infrastructure layer for derivatives

Variational Protocol is a peer-to-peer trading protocol for perpetuals and derivatives, enabling on-chain booking, clearing, and settlement on Arbitrum.

Variational Protocol supports peer-to-peer trading, clearing, and settlement of derivatives through a request-for-quote model deployed on Arbitrum. Traders request prices from market makers, and executed trades are settled inside isolated on-chain escrow contracts with pre-defined margin, liquidation, and settlement rules. The protocol supports perpetual futures, options, and customizable derivative instruments for retail and institutional users.

- Type: Protocol
- Sector: Finance
- Status: Active
- Profile: https://thegrid.id/profiles/variational_protocol

## Products

- [Variational Protocol](https://thegrid.id/profiles/variational_protocol): Variational Protocol is a peer-to-peer trading protocol for on-chain derivatives covering the full trade lifecycle—booking, clearing, margin management, liquidation, and settlement. It combines on-chain smart contracts with off-chain infrastructure components including a pricing oracle, a core margin and liquidation engine, a settlement and funding rate engine, and an on-chain transaction handler. The protocol supports trading of perpetual futures, options, and custom instruments, and serves as the underlying infrastructure for applications including Omni and Pro. (Derivatives , Live, Main Product)
- [Variational Omni](https://thegrid.id/profiles/variational_protocol): Variational Omni is a perpetual futures trading application built on the Variational Protocol and deployed on Arbitrum. It uses a request-for-quote mechanism where the Omni Liquidity Provider (OLP) acts as the sole counterparty to all trades, aggregating liquidity from centralized exchanges, decentralized exchanges, and traditional market sources. Omni charges no trading fees, supports up to 50x leverage, and covers crypto assets, equities, and commodities. Positions are cleared and settled on-chain in isolated escrow contracts. Omni redirects value that would otherwise go to external market makers back to traders through a rewards program. (Derivatives , Early access)
- [Variational Pro](https://thegrid.id/profiles/variational_protocol): Variational Pro is an on-chain derivatives trading platform under development, targeting institutions and advanced traders. Built on the Variational Protocol, it enables trading of customizable futures and options contracts—including unlisted and exotic instruments—via a request-for-quote flow. Pro automates OTC clearing, settlement, margin management, and liquidation, replacing manual coordination workflows. Traders face counterparties directly in isolated settlement pools, with configurable real-time margin parameters to mitigate counterparty risk. (Derivatives , In Development)

## Assets

- [Variational Token (VAR)](https://thegrid.id/profiles/variational_protocol): VAR is the utility token of the Variational Protocol. It is used within the protocol ecosystem, with a minimum of 30% of protocol revenue allocated to purchasing and burning VAR tokens from circulation. Approximately 50% of the total supply is earmarked for community distribution through various initiatives over time. (Utility)

## Links

- [Main](https://www.variational.io)
- [Documentation](https://docs.variational.io)
- [Media Kit/branding](https://docs.variational.io/more/media-kit)
- [Terms of Service](https://docs.variational.io/legal/terms-of-use)
- [Privacy policy](https://docs.variational.io/legal/privacy-policy)
- [Twitter / X](https://x.com/variational_io)
- [Discord](https://discord.gg/variational)
- [Telegram](https://t.me/variational_io)
- [Telegram](https://t.me/variational_chat)
- [LinkedIn](https://www.linkedin.com/company/variational)
- [GitHub](https://github.com/variational-research)

## Legal

This data is provided under two licensing models.

Model 1 - open data. The open data core is licensed under the Open Database License (ODbL) — a copyleft/share-alike license allowing free use, modification, and sharing for any purpose. Attribution is required: include "Powered by The Grid" linking to https://thegrid.id wherever the data is used. Derivative databases must be shared under ODbL terms. Trademarks, logos, and brand names (marked "Special TPIP") are not covered by the ODbL. For ML/AI use: training datasets that substantially extract ODbL data are Derivative Databases and must be shared under ODbL if publicly used; models must be attributed in documentation.

Model 2 - commercial licenses. The Grid Data Service (TGDS) is also available as a commercial license. See [Web Services Terms](https://about.thegrid.id/legal/web-services-terms) for commercial use that is not covered by the open data service.

The following applies to both licensing models.
- All data is provided AS IS with no guarantees of accuracy.
- The Grid does not provide investment, legal, or tax advice, and
- a project's presence in The Grid's data does not imply endorsement.


- [Data Licensing & Disclaimers](https://about.thegrid.id/legal/data-licensing-and-disclaimers): Licensing models and disclaimers
- [Open Data (ODbL)](https://about.thegrid.id/legal/open-data): Open Database License terms and scope for The Grid's open data service.
- [Attribution Guidelines](https://about.thegrid.id/legal/open-data-attribution-guidelines): How to attribute The Grid's data when using the open data service.
- [Web Services Terms](https://about.thegrid.id/legal/web-services-terms): commercial Terms for using data services.
- [All Legal Documents](https://about.thegrid.id/legal): Full index of terms, policies, and disclosures

## Optional

- [TGS Field Descriptions](https://github.com/The-Grid-Data/workspace-public/blob/main/references/tgs-field-descriptions.md): Schema field definitions for The Grid's data model
- [TGS JSON Structure](https://github.com/The-Grid-Data/workspace-public/blob/main/references/tgs-json-structure.md): Data model structure and relationships
- [Product Type Definitions](https://github.com/The-Grid-Data/workspace-public/blob/main/references/product-type-definitions.md): Definitions for each product type
- [Product Type Classification](https://github.com/The-Grid-Data/workspace-public/blob/main/references/product-type-classification.md): Guide for classifying products into types
- [Grid MCP Guide](https://github.com/The-Grid-Data/workspace-public/blob/main/grid-search/skills/grid-query/references/grid-mcp-guide.md): How to query The Grid programmatically via MCP