Monetized Cash Position
As a nascent asset class, cryptocurrencies transcend the categorical boundaries used to group traditional assets. Like precious metals, which have both industrial usage and act as stores of value, cryptoassets can be categorized as both non-sovereign monetary stores of value and consumable computational units in digital transactions. Recent developments in decentralized finance, however, have moved cryptoassets into yet another asset class category – capital assets which possess underlying cash flows and sources of passive returns.
By engaging in operations such as strategic lending and staking, we are always looking for new ways to engage with counterparties in the digital asset industry to better monetize our holdings which are not actively deployed in our systematic or discretionary strategies. As digital assets' open-source software continues to evolve, the asset class will differentiate itself further from other asset classes. As part of the multi-strategy portfolio that we offer at Pareto, we actively search for ways to leverage these new developments to earn additional yield on our holdings.
Details
Through strategic lending across a number of funding platforms for short-sale and margin trading, we earn competitive interest revenue on the assets we hold in inventory by helping to meet the working capital needs of counterparties that would traditionally engage with large financial institutions.
By staking particular cryptoassets in our portfolio, we generate predictable interest payment streams in exchange for making the underlying blockchain networks of our assets more secure and efficient.