Offchain strategies
A major part of sUSX’s yield comes from our partnered trading firm which operate market-neutral strategies (strategies uncorrelated to crypto market movements).
Our Partners
Our current partner is an established trading firm and have been active in both TradFi and crypto since 2020. The team has a very strong mix of trading, quant, and tech backgrounds.
Over the past five years, they have experienced virtually no losses, except during the FTX collapse, which resulted in a low single-digit percentage drawdown.
At Scroll, we've worked with them for a long time, so there's mutual trust built over many years.
On the risk side, the principal is actually enforced contractually through a loan agreement with the fund, so that is where the principal protection comes in. The zk attestation layer should launch in Q1 and will prove that the data being pushed is a verified report from our partners and that the CEX data has not been manipulated.
Some of the arbitrage strategies which they use are:
Basis Trading: Capturing price discrepancies between spot and futures markets
CEX-DEX Arbitrage: Capturing price differences between centralized and decentralized exchanges
CEX-CEX Arbitrage: Leveraging pricing inefficiencies across multiple centralized exchanges
Statistical Arbitrage: Utilizing quantitative models to identify and capitalize on temporary market inefficiencies
Calendar Spread Arbitrage: Capitalizing on mispricings between futures contracts of different expirations
Offchain Verification
Offchain strategy performance is verified through an external proof-of-reserves platform. It uses zero-knowledge proofs, trusted execution environments (TEEs), and verifiable Merkle trees, to verify and confirm asset balances without revealing private data. This integration provides trustless, privacy-preserving transparency into USX’s offchain yield component. We'll announce the platform soon.
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