The DeFi segment of the treasury aims to capture stable returns by putting treasury funds to work. If you’d like to learn more about the objectives of the DeFi segement, as well as strategies and risk controls, please read on.

1. Overview

Objective: Identify opportunities within the DeFi sector to capture outsized, market neutral returns, while limiting risk to the principal capital deployed

Target returns: 10% PA on capital invested

Expected volatility: 5%

Contents

1. Overview
2. Primary strategies
   1. Yield farming
   2. Lending
   3. Funding rates
3. Risk controls
   1. Exposure parameters
   2. Protocol safety assessments
   3. Lending controls
   4. Custody risk
   5. Funding rate collateralisation

2. Primary strategies

a. Yield farming

Expected return: Medium

Expected volatility: Low-Medium

Target weighting: Up to 100% of deployed capital

Overview: Yield Farming is the placing of crypto assets into decentralised platforms to earn returns by providing provision. As demand for liquidity grows, many platforms grant attractive rewards such as governance tokens to increase rewards for their liquidity providers.

Key risks:

• Price risk: The treasury will use stablecoins for yield farming strategies. The exposure parameters segment outlines maximum exposure parameters which will help shield the treasury in the event a de-pegging occurs.
• Smart contract risk: The treasury will assess the reputability of the project by only engaging with protocols that have passed our due diligence process outlined below.