Smartcoins

Smartcoins are next-generation YVTs supercharged by algo-trading.

As next-gen yield vault tokens supercharged with algo-DeFi trading, "smartcoins," are comprised of two key ingredients:

1. A collateral/parent asset, giving the smartcoin inherent value to trade (e.g. BTC, ETH, SOL, etc).

2. Strategies that dictate how the underlying collateral should be traded at a pre-defined risk-to-return ratio (oftentimes quantitative strategies).

Smartcoins autonomously trade their own value based on the strategies embedded within them, just as traditional structured financial products function. The potential variety of smartcoins is limitless, with each designed to achieve specific financial objectives, offering a dynamic tool for investment and risk management with extremely low onboarding and financial literacy requirements.

You can think of a smartcoin as putting a pro-trader into the cryptocurrency itself so that they can execute trades & maintain the cryptocurrency's value. All you have to do is HODL (i.e. hold the digital asset).

Watch our founder Robby Greenfield as he gives us a walkthrough of Umoja´s Smartcoins.

Example: bstETH > stETH

For example, consider we wanted to create an upgraded version of staked ETH, or 'stETH,' that had better yields. We'll call this new version of stETH, 'boosted stETH' or bstETH.

bstETH, being smartcoin, has two ingredients:

1. Collateral Asset. stETH

2. Strategy. A 10x levered, long strategy that has no liquidation risk.

bstETH will re-invest the yield generated from its stETH into its own 10x-long synth, maximizing returns during a bull run and protecting the stETH principal. The outcome is a token that generates a much higher APY than the original stETH.

Learn more about the first available Smartcoin: $yBTC