Umami Finance Treasury Update — February 2023

5 min readMar 12


By Wen Moon and Steven-T

Firstly we would like to apologies for the delay in February’s Treasury Update, this was due to the fact that some DAO contributors were at ETH Denver and the Treasury Team were focused on the USDC depeg immediately after. We are grateful to have seen much of the community and fellow builders in Denver and if you didn’t get a chance to say hi, there will be plenty of other opportunities.

One thing to note for this Treasury Update will be that the effects of the USDC depeg will not be included, since that occured in March. However, we will share some more thoughts on that in the final section of this report.

As for February, it should be obvious that the $UMAMI token faced aggressive sell pressure. It is important to note that this did not effect the viability of UMAMI’s product line in any way, in fact testing results are looking better than ever.

For the treasury, this obviously meant that most of the ETH deposited into the LPs was syphoned away, however we were able to limit this thru univ3 and even use this chance to accumulate undervalued UMAMI such that the treasury is currently in profit on its average buy price! This opportunity has meant that the treasury is relatively flat in Umami distribution since June of last year despite having generated 2M$+ in value!

With all that in mind, let’s take a dive into last month’s statistics and strategies:

Overall Performance

Treasury value, excluding UMAMI token holdings:

  • End of January, $4.56m
  • End of February, $4.41m

In the month of February, there was a Net Treasury Loss of $147,369 or 3.29%.

For comparison:

  • The total crypto market cap was $1.005T on January 31st and $1.015T on February 28th, which is a net increase of 1%. (market cap calculated by tradingview)
  • The price of Bitcoin was $23,127 on January 31st and $23,146 February 28th, which is a net increase of 0.1%.
  • The price of Ether was $1,585 on January 31st and $1,605 on February 28th, which is a net increase of 1.26%.

The treasury performed well considering it’s hedged nature and $Umami price activity.

Gross Yield: $95,300 at time of writing, which constitues a 27.5% APR return for the whole treasury!

  • 53.47 ETH ($85,819.35)
    44.69 wETH from GLP, 4.8579 wETH distributed to marinatoors
    8.78 ETH from Uniswap + Kyberswap
  • 96.96 esGMX ($7,037)
  • Uniswap V3 ($22,315.62 Inc. UMAMI)
    ETH — 8.78
    UMAMI — 508.77
    USDC — 2,444.55

Net Yield was $87,504.01 using Gross Yield — Marinator Payout.

Expenses: Umami’s OpEx outflow was $0 in February. This is because contributors decided to defer payments until the DAO structure was more formally implemented.

Asset Appreciation for Umami’s treasury is a net depreciation of $235,005.52 or 5.2%, using this formula:

Asset Appreciation = Net Treasury Gain — (Gross Yield — Expenses — Marinate Payout)

Treasury Breakdown:

Currently the breakdown of our treasury is as follows:

Liquid Runway: is $3,329,909 or 13.3 months (assuming monthly opex of $250k). This is the value of any blue-chip liquid treasury holdings. This month, it constitutes our GLP position, treasury stables + ETH, GMX hedges and our Vendor positions.


As market bullishness presented itself, the treasury decided to close treasury hedges and allow our GLP position to act as our hedge to the market. Since then, the market is higher and the GLP open interest remains net long. GLPs increased long exposure lowers our treasuries beta against a bearish move, meaning our treasury remains well-hedged. This strategy lowers our cost to hedge and overall risk as long as GLP’s long exposure stays high. We will be constantly monitoring this, and especially Andrew Kang’s positions which have been providing a positive drag on trader PNL.

UMAMI Liquidity Pools

Despite a significant amount of ETH being absconded from the Umami DAO treasury through the liquidity pools, the treasury remained resilient thanks to the concentrated liquidity strategies in place. This is a time to really reflect on the effectiveness of univ3. Thanks to it, we were able to limit treasury downside by only providing liquidity close to in range and at key levels of accumulation. If we were to provide the same depth of liquidity in a v2 style LP, the overall losses would be more in the range of 2M$+.

As for the treasury accumulation of Umami, we were able to set a significant portion of our buys under RFV which adds value to each token holder directly! Additionally, the liquidity for these buys were pulled meaning that the buys and prices were locked in. The aggressive sell pressure and preceding fud led to our largest volume day ever! With over 2M$ in volume traded through the LPs, even at lows of 50k in liquidity, in 24 hours.

Vendor Finance

Considering the situation we had to pause our use of Vendor pools, however we are looking to start lending on there again soon, with LTVs at or under RFV. We are observing demand for loans currently, so if you are looking for one let us know your desired terms!

The platform itself has been working great, with still 100% repayments.

Final Thoughts

A rocky month for Umami but both the treasury and DAO have come out the other side stronger than ever! As for the USDC depeg, at the time or writing this, USDC seems to be repegging in light of confidence from Circle Public statements on the expected assets retrivable from FDIC and SVB and the proactiveness by Circle to cover any remaining downfall. As a result, the treasury should not be adversely affected eventhough we had significant exposures to USDC through our GLP positions. We will maintain a close eye on how the situation unfolds, but the most telling time will be when banks open their doors once again on Monday and USDC can once again be converted freely for USD.

As always, we are happy to hear to any feedback and answer questions about DAO treasury strategy, so feel free to ping the DAO contributors regarding it.

See you next month!





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