Our hedging strategy for our BUSD pool

Unlike other stablecoin staking platforms, we do not source our yield from ponzinomic tactics, we use sustainable, proven, profit-generating trading strategies by expert investors so we can distribute consistent rewards to our stakers.

This has only been further evidenced by the recent market conditions which burned a lot of traders, however, our robust hedging strategies made it so we saw the coming volatility and positioned ourselves (and our users) to be greatly rewarded.

Our strategy for the more bearish turns of the market was simple, hedge our long exposure on our NFTs, LAND, liquidity pools, etc. Our hedge was done through shorting BTC, the inevitable direction decider for the entire crypto market, while also being the strongest and most liquid, this made it so we did not have to experience the high volatility you seen on SOL, XRP, ADA, etc. Essentially, blunting the market force while adding the ability to look at the market from a macro-directional perspective.

Furthermore, as we prepare for more downside, we plan to continue to hedge against our long exposure by holding a portion ($250k) of our BTC short from $20,500. This allows us to hold value in the event of another fall and remain profitable in our hedge with our stops being placed at breakeven and above.

While other projects are losing value due to a decreasing market, we are holding steady because we foresaw and prepared for an economic downturn so we can take advantage of the opportunities presented during these times.

That said, we do still believe in crypto long term, this is a normal part of the market cycle and we should, as market participants, expect the unexpected. Opportunities will arise and we are well-positioned to take them. Our strategies are sustainable, making our pools and VEMP a great way to gain exposure to a market that is trending in either direction.

Comparing us to other stablecoin staking platforms like Anchor would be incorrect. Their strategies to provide users with high yields were unsustainable to say the least. They were built upon ponzi-economics with obvious vulnerabilities that users could take advantage of.

We, instead, do not rely on the stability of an entire protocol. We generate rewards through the strategies of our experienced and proven traders which have been able to generate consistent returns for years. Meaning, one protocol failing does not impact the health of our project. We have the ability to appropriately manage risk in coordination with market conditions to ensure the safety of our liquidity.

Put simply, hedge funds have been running successfully for years. Our ex-hedge fund traders have moulded their proven strategies over to crypto so that we can remain sustainable over a long period of time while keeping users safe by steering away from using ponzi-like economics to reward our users.

The 18.76% figure shown above is calculated from annualizing our last payout to stakers. The last payout figure was calculated over a 1 year period to get the final 18.76% number.

--

--

Get the Medium app

A button that says 'Download on the App Store', and if clicked it will lead you to the iOS App store
A button that says 'Get it on, Google Play', and if clicked it will lead you to the Google Play store