Sommelier’s Mission and Strategy
The Values
At Sommelier, we believe in the potential of DeFi, a world where:
- It’s easy to transfer value without the need for trusted intermediaries.
- Economic decisions are reached through community consensus rather than by centralized authorities.
- The state of the financial system is transparent and auditable by all.
- Financial products and services are accessible to everyone, 24/7, regardless of their wealth, status, or location.
- Individuals and groups have strong property rights.
The Problem
However, navigating within DeFi is difficult, and it’s only truly accessible to a small group of technically-inclined people who have the time to research protocols, constantly monitor the market and actively manage their positions. Doing anything less results in missed opportunities and undue risk. In short, it’s a full-time job even though it shouldn’t be. This is where the Sommelier protocol and associated DAO comes in.
The Mission
At Sommelier, our goal is to make interacting with DeFi more accessible, profitable, and efficient. This means:
- Accessible: Creating a simple interface for DeFi.
- Profitable: Building products that consistently pursue the best opportunities.
- Efficient: Saving users time, energy and cost.
The missing piece of the Defi accessibility story is a non-custodial, independently governed system for on-chain asset management. Sommelier has deployed a protocol governed by the SOMM holder community that brings together strategists with on-chain vaults that offer the simplest possible interface to advanced DeFi positions.
- Want to use a DeFi App and don’t know where to start? Deposit into a vault.
- Have a token and want to earn the best yield? Deposit into a vault.
- Not a trader but want to systematically buy certain tokens? Deposit into a vault.
- Want to hedge your risk but don’t know how? Deposit into a vault.
Next, vaults need to be intelligent so they can adapt to the ever-changing DeFi conditions. Today, many of the vaults in the market only have simple automation which goes stale once market conditions change. Sommelier vaults, on the other hand, are intelligent and capable of predicting, responding, and evolving. For example, a vault can analyze historical data to forecast future yields, respond to breaking news, support new assets and integrate with new apps.
Finally, the experience of using a vault needs to be efficient. This includes reducing the time spent on researching opportunities, eliminating the stress of actively managing positions, minimizing transaction fees, and improving capital efficiency.
The Strategy
Sommelier has a three-pronged strategy for how it’s going to achieve this mission.
- Portfolio optimization: Allocate tokens and help reduce risk for individuals, institutions and DAOs.
- Protocol / app enhancement: Enable intelligent automation of protocols to streamline user experience and improve capital efficiency.
- Asset management infrastructure: Provide an all-in-one robust infrastructure for vault creators.
Portfolio Optimization
The portfolio management use case has the most market adoption and is also where Sommelier has gotten its early traction. To that end, Sommelier will focus on the following:
- Onboarding new vault creators: Recruit a pipeline of crypto-forward strategists that can create high-quality vaults. Strategists that create vaults for new assets, new risk tolerances, or have an existing following are the top priority.
- Improving discoverability: Integrate with yield aggregators, wallets, exchanges, dashboards and FinTech partners to increase the number of onboarding channels to Sommelier vaults.
Protocol / App Enhancement
We believe the protocol enhancement use case has been underexplored by the market, but has the potential to be extremely large. By functioning as a value-added automation layer in the background, Sommelier can more easily serve new users.
- Integrating with apps: Partner with protocols to offer automation and all-in-one experiences for their users to optimize yield, reduce risk and save transaction costs.
- Investing in security: Continue to invest in smart contract audits, bug bounty programs, and protocol upgrades to create a safe, robust system.
Asset Management Infrastructure
As more and more assets migrate on-chain, we want to position Sommelier as the premier asset management infrastructure for any token on any network.
- Building smart contract adapters: Write adapters for all of the top protocols as well as where there is strong strategist or partner demand.
- Expanding multi-chain: Upgrade the Sommelier technology stack with new bridge capabilities that give strategists instant access to all of the top chains.
- Adding strategist tooling: Provide strategists with more tools so that interacting with vaults is more intuitive and efficient.
Summary
The value of the Sommelier network lies in its network effect. Each added adapter, new chain, and successful strategy contributes to the overall value and credibility of the network. The set of SOMM token holders, protocol developers, strategy teams, front-ends and marketing teams form the basis of the Sommelier Protocol DAO, which will grow this network effect over time.
At Sommelier, we are laser focused on our mission and strategy. We won’t stop until everyone can access DeFi, and all of its capabilities to improve their life and the lives of their family.
About Sommelier
Sommelier is an innovative asset management protocol whose mission is to make DeFi more accessible, profitable, and efficient for everyone. Our advanced technology built on the Cosmos SDK, enables intelligent vaults that can optimize portfolios, trade long-short, borrow-lend, and farm. Independent strategists can leverage the power of off-chain computation to bring algorithmic vaults on-chain, allowing vaults to dynamically adapt to market conditions and provide enhanced opportunities and risk mitigation to users. All vaults are enabled by audited smart contracts and controlled by protocol governance, ensuring transparency and security.
