We're happy to provide our fourth monthly Transparency Report, which is designed to bring some peace of mind to our users so that they know where their funds are being deployed. The allocations presented below are subject to change depending on strategy performance, future yield projections, and the evolution of the customer deposit mix.
*The report is subject to market changes and numbers shown are a rough estimation **Target asset allocation is for reference only and subject to change per market conditions and business strategies
This is old news now but the Merge is complete and couldn’t have been more uneventful from both a price action and technical perspective. The major impact was a narrowing of the gap between staked ETH (stETH) and ETH. With the benefit of hindsight, the strategy of keeping our ETH assets in productive Defi protocols rather than in a ETH wallet to try and capture ETHPoW token airdrop was the financially better decision. ETHPoW quickly dropped to 0.4% of ETH value and remains a highly speculative asset as there are few applications operating there. Some users may have been disappointed not to receive the airdrop but executing this would have resulted in much lower yields paid to ETH holders.
We also introduced USDD to our customers in August with yields at 11%. After the established stablecoins (USDT, USDC, BUSD), USDD is in the mid-tier range of mostly algorithmic or overcollateralized stablecoins which includes DAI, FRAX, USDP, and TUSD. This is also where UST would have sat if that system hadn’t collapsed. We advise our customers to be cautious with USDD as the higher yield implies higher risk and it lacks a long track record. The coin was introduced in 2022 and needs time to provide itself. USDD did depeg from $1 to $0.96 at the height of the summer panic but recovered which showed enough resiliency for us to offer our customers. Alternatively, the longer USDD proves itself, the lower the expected yields will be.
September Yield Changes
We’ve been working on raising our stablecoin yields and that can be seen in our September yield change where we have raised rates on all our stablecoins, with significant increases for XSGD and XIDR. While not globally significant, these stablecoins are important for our SEA customers, and we will look to add stablecoins pegged to the Philippines Peso, Vietnam Dong, Thailand Baht and Malaysia Ringgit as they become established.
We also increased rates for APE, BNB, ETH and XRP while reducing ADA, ATOM and NEAR. We expect to increase rates in October for our DOT, SAND and XRP holders.
We’ve increased our allocation to Defi, which is a result of reductions in CEX margin lending accounts and self-custody.
Our target allocations from July remain unchanged and are as follows:
DeFi protocols: 40-65%
Centralized exchange (CEX): 25-50%
Self custody: 5-15%
CeFi platforms: 0%
As of the end of September, our allocations are as follows:
DeFi protocols: 48.3%
Centralized exchange (CEX): 47.9%
Self custody: 3.76%
CeFi platforms: 0%
We have more exciting plans for October so stay tuned.
We believe in providing transparency to our users on the company's activities and aim to increase our users’ view of where their coins and tokens are and how they are performing. As always, we'd love to hear more feedback about the types of info you want.
All the best,
The Finblox Team