Kateryna Hryhorieva

Universe Finance is an active liquidity management platform of Uniswap V3 based on risk ranking and quantitative strategies.

Universe VS Yearn

Yearn Finance (YFI) is a benchmark of liquidity management. There are some key differences between Universe and Yearn. ‌

Universe = Yearn + Uniswap V3Universe = Yearn + Uniswap V3 ‌

Universe = Yearn + Risk GradingUniverse = Yearn + Risk Grading ‌

Universe = Yearn + Quantitative StrategyUniverse = Yearn + Quantitative Strategy ‌

Universe = Yearn + Leverage Trading ‌Universe = Yearn + Leverage Trading ‌

Products

With a series of products, Universe Finance can meet the needs of LPs who have different risk appetites.

Uniswap V3 Backtesting Platform

Uniswap V3 Active LP Quantitative Management Strategy

Uniswap V3 Smart Vault

Uniswap V3 Private Vault

Uniswap V3 Hedging Vault (Developing)

Uniswap V3 Leveraged Vault (Designing)

The Challenges on Uniswap V3

• Uniswap V3 Backtesting Platform
• Uniswap V3 Active LP Quantitative Management Strategy
• Uniswap V3 Smart Vault
• Uniswap V3 Private Vault
• Uniswap V3 Hedging Vault (Developing)
• Uniswap V3 Leveraged Vault (Designing)

The most significant improvement of Uniswap V3 is its ability to gather liquidity in a specified range, and in this way, it can generate earnings several times more than V2. Although it produces high yields, it also causes many challenges to LPs:

Challenge 1：High risk

While centralized liquidity can enlarge the income by increasing the capital efficiency, it also amplifies the impact of impermanent loss, especially when the price is out of range. Once it happens, the impermanent loss may continue to increase while the income goes to zero.

Challenge 2: High cost

To ensure the sustainability and stability of income, rebalancing and reinvesting are necessary, but they both require users to pay high Gas fees. For ordinary users, the gas fee will blow away all the fee income carelessly.

Challenge 3: Rebalancing

How to dynamically set the optimal price range to earn the optimal fee income? When the price deviates, it may face the risk of abnormality if it is not balanced, and it may also face the risk of loss of net value after the price returns. The timing and parameters of rebalancing are two complex quantitative matters.

Challenge 4: Reinvestment

Compared with automatic reinvestment on V2, V3 requires manual reinvestment of the fee income. How to resume investment continuously and stably? How much influence does the gas fee of reinvestment have on the returns? These problems are extremely challenging for most LPs.

Challenge 5: Hedging

Uniswap LP needs to provide dual currency investment (e.g., ETH-USDC). How do U-based users with low-risk preferences offset the price fluctuation of risky assets (such as ETH)? Furthermore, how to hedge the risk of LPs' impermanence loss?

Who do we serve?

Risk-averse users

Example 1: U-based users or arbitrageurs with the lower risk appetite Example 1: U-based users or arbitrageurs with the lower risk appetite

Need:Need: cutting-edge hedging strategies and tools that allow users to earn low-risk arbitrage returns.

Challenge:Challenge: lack of efficient LP hedging strategies and useful LP hedging tools.

Example 2: High-net-worth users and institutions Example 2: High-net-worth users and institutions

Need:Need: fund security+secured smart contracts.

Challenge:Challenge: smart contracts are between Scylla and Charybdis at the moment.

Risk-neutral user

Example: currency-based users or ordinary liquidity miners. Example: currency-based users or ordinary liquidity miners.

Need:Need: looking for higher and more stable LP income

Challenge:Challenge: currently, the income of mining is comparatively low and unstable.

Risk-seeking user

Example: transactional users with higher risk preference. Example: transactional users with higher risk preference.

Need: Need: looking for high-risk and high-yield trading opportunities and earn stable mining income

Challenge:Challenge: lack of appropriate products in the market that can earn mining and trading income at the same time

Universe solves these problems and meets the needs through a series of combinable products.

Universe Backtesting is the first LP revenue backtesting system on Uniswap V3 with accurate on-chain data, granularity of block-level backtesting, flexible self-defined parameters, and robust strategy analysis indicators. It can help users understand the benefits and the risks of Uniswap V3 LP easier and customize the LP strategies.

The active LP management quantitative strategies solve many problems on Uniswap V3 LP: high risk, high cost, rebalancing problem, extreme market situations, high loss value, etc.

Based on the underlying principle of Uniswap V3, we established a multifactor quantitative financial model. We finally created a strategy model with stable income through a large amount of data backtesting and optimizing. According to the backtesting data in the previous two months, the annualized earning of fee APY of the smart vault reaches 150%+. The net annualized income is up to 50%~70%. These two items are outperforming all revenue products on the market.

Target users: currency-based users or ordinary LP users (risk-neutral users)

Product Description: A specific intelligent quantitative strategy supports each smart vault. Under the instruction of the strategy signal, the strategy contract dynamically rebalances the liquidity position of LPs, and helps users earn fee income.

Target users: high-net-worth individuals and institutions (risk-averse users).

Product Description: the Universe private vaults is the intelligent vault with high-level security for high-net-worth individuals and institutions. Comparatively, the private vaults have improved their security through multiple technical solutions. And from a service perspective, the private vaults adopt a flexible deployment scheme to meet the user’s security needs fully.

Target users: USDT-based users or arbitrage users (risk avoidance type).

Product Description: With the hedging vault, users can borrow money to create market-neutral hedging LP positions, generating more fee income and offsetting the price risk of risky assets in the positions.

Target users: transactional users (risk-seeking users).

Product Description: by depositing in the leveraged vault, users can create long or short trading LP positions to earn trading income based on market evaluation and earn high mining income. However, trading LP positions would face higher liquidation risks.

High return: the true return rate of ETH-USD LP in Universe Finance is the highest in the past few months.

Stable income: after extreme market tests, our users can still enjoy low retracement and high Sharpe ratio and continuously earn fee income.

Low cost: users do not need to pay the expensive gas fees for rebalancing and reinvesting.

Risk grading: risk is the foundation of finance. The risk grading management systems can meet the needs of different LPs.

Simple: automatic balancing, automatic reinvesting, automatic income tracking, etc.

Holders of TWT tokens unlock a variety of benefits when using Trust Wallet, including discounts on in-app cryptocurrency purchases and on the use of decentralized exchange (DEX) services. TWT holders can also participate in the governance of Trust Wallet and can vote on Trust Wallet update proposals, helping to shape the development of the app.

Trust Wallet Token was initially launched as a BEP-2 asset on Binance Chain, but was relaunched as a BEP-20 token on Binance Smart Chain in October 2020

Targeted support: Ethereum, Bitcoin, Optimism, Polygon (Matic), and BSC

Endless Possibilities

There are various use-cases for a network that can automate on-chain activity. Below are a few of the examples of what we are currently working on.

Steer Protocol provides pools for Uniswap v3 that, when allocated, recalculate daily to intelligently outperform traditional liquidity management. Steer Protocol reduces the hassle for liquidity providers aiming to increase capital efficiency through complex algorithms. Liquidity providers can enter and exit pools within the protocol or create their own strategy.

Confidential Assets

Make account balances and transaction amounts confidential. Only you know your own balances.

Anonymous Identity

Conceal the relationship between sender and receiver and make yourself anonymous in blockchain networks.

Privacy Bridges

Bridging different blockchain platforms to enable direct interactions between digital assets with complete privacy.

XPRT Token

The XPRT token is primarily a governance token for the Persistence chain. Once the Persistence mainnet is launched, token holders will be able to stake XPRT tokens to passively earn more XPRT. XPRT token also plays the role of a ‘work token’, allowing the stakers to produce cash flows in correlation with the transaction volume generated by dApps in the Persistence ecosystem.

Persistence is an interoperable protocol built to facilitate the creation of next-gen financial products. The Persistence tech stack provides the infrastructure to effectively bridge the realms of DeFi and traditional finance in a variety of areas, whilst also enabling the creation of innovative crypto-facing solutions to expand the DeFi and NFT sectors.

The Internet disintermediated the Media & Communications industry. Using HTTP, SMTP and TCP/IP as the foundational layers, the cost of information exchange was significantly lowered.

Persistence is leveraging blockchain technology to facilitate seamless asset exchange. Using Web 3.0 protocols, Persistence aims to enable and create a suite of bleeding edge financial products in niches ranging from staking-as-a-service and tokenized real-world debt to digital art.

pSTAKE is the protocol that unlocks liquidity for your staked assets. With pSTAKE, you can securely stake your Proof-of-Stake (PoS) assets, participate in protocol improvements and security to earn staking rewards, and receive 1:1 pegged staked representative tokens which can be used to explore yield opportunities across DeFi.

At present, pSTAKE supports Cosmos and Persistence networks’ native tokens with a view to support more chains and assets in the future.

pSTAKE issues staked representative tokens through a custom bridge built to tap into the growth of the Cosmos ecosystem while accessing the liquidity and composability of Ethereum. Users can either hold these representative tokens as ERC-20 to maintain the liquidity of their staked assets, or use them to discover yields offered by other DeFi protocols.