Project Introduction
Braindead Digital is a cryptocurrency development company, with a goal to create a reality “where technology truly serves users rather than constraining them”. This goal extends to minimizing allocative capital inefficiencies. With our flagship USDC Silo vault, we aim to provide our depositors with always-optimal yields managed automatically, which in turn results in higher levels of DAO revenue.
Examples of yield offerings from a backtest of the vault’s strategy using $250K can be seen as follows (from the inception of Silo on Sonic to May 25th):
As can be seen in this graph, our optimized portfolio strategy would have produced an average of about 11% APR. This is not considering any SILO incentives or point calculations.
Additionally a snapshot comparison of our optimal allocations versus current returns on Silo’s largest vault reveals the extent of the allocative inefficiency caused by current vault management (numbers as of May 29th). As can be seen here, Braindead’s strategy outperforms the May 29th strategy by over 50%, and if extrapolated to a year-long timeframe, this results in depositors missing out on over $300K of possible earnings. More vault comparisons can be found here. Overall, Silo Vault users are missing out on a total of over $500,000 of rewards yearly. This is not only detrimental to users, but also to the DAO. Taking the lowest end of the spectrum, we can assume that the DAO fee on these rewards is 10% flat. This means that the Silo DAO is missing out on over $50,000 in revenue yearly.
Team Introduction
Z – Founder and Lead Developer – Fantom community member since 2021, developer since 2017. Economics and Business student.
Vault Type
Flagship USDC
The flagship USDC vault is dedicated to providing the highest level of yield possible, and thus the following markets will initially be whitelisted*:
- USDC Market 8
- USDC Market 20
- USDC Market 23
- USDC Market 27
- USDC Market 34
- USDC Market 36
- USDC Market 49
- USDC Market 50
- USDC Market 55
- USDC Market 102
- USDC Market 103
- USDC Market 104
* Subject to change in the event of new markets being added/existing markets being deemed unsafe.
Security Considerations
Security is of the utmost importance when dealing with user funds. For this reason, Braindead Digital will implement a 3 of 4 multisig containing Braindead core contributors, and other established members of the Sonic community including:
- Chainvisions/Crab, founder of Beluga Finance and Limestone
- DOG, co-founder of The Kingdom, executive at Shadow
- 0xlaw, CEO of Stream Protocol
A 24-hour timelock will be applied for all relevant timelock actions, and all actions will be announced prior to the start of the 24-hour period to allow users to make informed decisions.
Allocations will be performed through a public proxy contract to allow for easy automation, and any addresses with the ability to change allocations will be published publicly on a dashboard. Additionally, this same dashboard will display information about historical allocations and vault performance, as a core belief of Braindead Digital is that transparency is foundational to security.
As part of transparency efforts, we invite Silo DAO members and users to get in touch with us at hi@braindead.tech.
Risk Management
Prior to any market being whitelisted, Braindead Digital along with multisig signers will perform a risk assessment on said market and evaluate it based on the following:
- Collateral stability
- Liquidity requirements
- Market age
Caps for markets will be assessed on a case-by-case basis using the same framework.