By Steven-T
GM and welcome to 2024! We’re all set to kick off the year on a strong note. The Umami GM vault auditing report is in its final stages of completion by Guardian this week, keeping us right on track for a late January launch. Furthermore, we’ve received fantastic news that our GM vaults qualify for GMX’s STIP grant system, entitling us to receive up to 100k in direct ARB incentives. In addition to the anticipated double-digit APRs that the GM vaults will deliver (with their ARB incentives factored in our vault performance), the additional ARB we receive will be completely emitted throughout February. This holds the promise of generating additional double-digit APRs solely through direct ARB emissions. Exciting times ahead!
Now, let’s take a dive into December’s numbers:
Overall Performance
Treasury value, excluding UMAMI token holdings:
- End of November, $3,256,164
- End of December, $3,619,970
In the month of December, there was a Net Treasury gain of $263,806 or 8.1%.
For comparison:
- The total crypto market cap was up 15.3% to $1.6051T
- The price of Bitcoin was up 11.9% to $42,258
- The price of Ether was up 11% to $2,280
Gross Yield: $27,216 which constitues a 8.3% APR return for the whole treasury!
- 6.09 ETH ($13,885)
4.75 wETH from GLP, 6.32 wETH distributed to marinatoors
0.44 ETH from Liquidity pools
0.9 ETH from vaults profit - Liquidity pools($10,942)
USDC — $4,245
ETH — $1,003 (.44)
ARB — $4,094 (2,641)
UMAMI — $1,600 (409) - GMX GM Vault STIP ARB incentives
ARB — $5,373.85 (3467)
Net Yield was $12,886.65 using Gross Yield — Marinator Payout.
Expenses: Umami’s OpEx was $94,922 in December. The monthly USDC break down:
Fixed OpEx was $94,500
Variable Expenses $422
Asset Appreciation for Umami’s treasury is a net appreciation of $445,840.36 or 13.6%, using this formula:
Asset Appreciation = Net Treasury Gain — (Gross Yield — Expense Outflows — Marinate Payout)
Treasury Breakdown
Currently the breakdown of our treasury is as follows:
Liquid Runway: is $2,384,599 or 14.9 months (assuming monthly opex of $160k). This is the value of any blue-chip liquid treasury holdings. It constitutes our GMX positions; treasury stables + ETH and our Vendor positions. It does not include UMAMI, ARB, esGMX or xGRAIL.
GMX
Umami’s GLP vaults are steadily increasing their share of GLP’s TVL. Despite a decrease in GLP assets under management, Umami’s portion of the total TVL has continued to rise. Currently, out of GLP’s $175 million, $4.8 million is now integrated into Umami’s vault system. With Umami vaults now accounting for 2.7% of the total GLP liquidity, we can only expect these figures to expand further as users opt for single asset exposure while still providing liquidity for GLP.
GMX V1 traders continued their winning streak cashing in $4,336,428 in December. Even with traders winning, GLP price still managed to move from $1.131 to $1.185 holding it’s value nicely as it should. Traders have mainained their long positions so GLP and its affiliated vault products will continue to serve as efficient instruments for those seeking to hedge or take on a bearish stance in the market.
Umami GLP Vaults
As many of you are aware, Umami’s GLP performance fees are currently disabled during these bullish market conditions. It’s crucial to recognize that as open interest on GMX V1 remains heavily skewed towards long positions, the performance of Umami’s GLP vaults will be mostly reliant on the market’s performance.
UMAMI Liquidity Pools
As pledged in the previous month’s update, we’ve introduced a full range liquidity pool position to the Uniswap UMAMI/ETH 1% pool. This move was in response to community requests, ensuring that all price points are accommodated and that a lasting position is secured for the community. We remain committed to “feeding” this LP to bolster depth as needed. Our objective is to maximize capital efficiency of the treasuries assets while ensuring ample liquidity for those seeking to enter and exit the token.
This month, we’ve successfully accumulated well over 10,000 UMAMI tokens into the treasury via the liquidity pools. Thanks to our strategic use of liquidity support, we’ve taken advantage of recent UMAMI token sales. Our strategy involves removing these tokens from the market to prevent selling them at lower valuations, thus safeguarding the current holders’ share of the protocol.
You can expect the treasury to maintain a commitment to supporting the token and accumulating when the timing is right. We’re actively exploring new community-driven liquidity ideas, and we’ll share more details once our plans are solidified.
Vendor Finance
As the vendor loans expired in early January, an impressive 21,917 UMAMI tokens were amassed into the treasury at the strike price of $3.69 each as depositors chose to keep their borrowed USDC. This acquisition has increased the total supply under the treasury’s control to ~290,000 tokens. In response to the substantial demand, a new higher fee liquidity pool has been established for testing. Currently, there is still $44,000 USDC available for borrowing against cmUMAMI, offering an APR of 48% at a 74% Loan-to-Value (LTV) ratio. This presents an opportunity for those interested in participating.
ARB STIP Program
Important Notice The STIP program is approaching its conclusion this month, with the last ARB distribution scheduled for 1/26. This marks your final opportunity to exercise the oARB, as they will become worthless once the program’s 750k ARB allocation is fully claimed. The next distribution, totaling 107,143 ARB, is set for 1/12, followed by the program’s final distribution on 1/26 which will distribute 214,286 ARB. Both these distribution events are expected to be claimed rapidly, likely within 24 hours so be ready! Emitting the remaining ARB allocation as early as possible on 1/26 ensures maximum participation from oARB holders, granting everyone the best chance for redemption. This timing aligns well with the launch of GM V2 vaults and the expected 100k in ARB emissions, slated to go live on February 1st.
The STIP analytics page can be found here
Galxe Quests Continue!
After the successful engagement of thousands of users, we are continuing our partnership with Galxe to start the year off right! There will be another chance to collect points, complete tasks and earn your chance to win some great prizes. Keep your notifications on and get ready to claim your Umami OAT!
Kyberswap Grant
In other great news, Kyberswap has created a grant system to fully reimburse all losses from their recent elastic liquidity pools exploit. That means Umami is positioned to recoup all recent losses ($422k) through a USDC vesting contract over the next year, further adding to the sustainability of the treasury runway.
DAO Proposal
The community is actively engaged in discussions aimed at finalizing the team structure and a proposed compensation system. In a nutshell, the team is open to reducing their USDC compensation in exchange for UMAMI vesting. These talks are ongoing, and we wholeheartedly encourage the community to share their views on the official commonwealth board. Your input is invaluable in shaping these important decisions.
Final Thoughts
The year 2023 presented its fair share of challenges for the DAO as a whole, but our position for success remains intact. Having distributed over 134 ETH to marinatoors in 2023, the team’s dedication to product development and returning value to the community remains resolute and steadfast.
Umami’s treasury experienced an above-average performance thanks to the increase in value of esGMX and ARB. The treasury remains actively deployed in yield-generating positions, strategically poised to seize opportunities amidst upcoming volatility while also being ready to capitalize on any market downturns.
As we’ve all observed, the SEC has been engaged in a bit of a cat-and-mouse game with the market, attempting to delay the ETF until the very last day, which is now upon us. While approvals are anticipated to go through, and the ETFs may begin trading by week’s end, there’s always a possibility of unexpected twists. If approved this week, BTC faces its first line of resistance at the yearly resistance of $52,500. However, in the event of another delay, we might witness support levels dropping all the way down to $34,500. Stay tuned for these market dynamics to unfold.
As always, feel free to reach out to me regarding any questions or feedback. See you next month!
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