Wonderland Treasury Report Q2 2023
written by ruian, Wonderland Financial Officer
The treasury spreadsheet showing positions as of the 29th of June, 2023 is included at the end of this article. Our second quarter has brought a 13.4% return to holders (that’s 53.7% annually) after all fees. The backing value of wMEMO increased by $5,052 per token amounting to over $16mm in profit. We continue to work hard for you and the remainder of the year is looking better for crypto barring a black swan event.
A Look Around the Market
Bitcoin spot ETFs appear to be right around the corner with Ark and BlackRock slated for decisions in August. Big TradFi players are also looking to open exchanges. This could prove a great boon to crypto adoption and cash inflows.
Traders are looking at Celsius and Voyager converting all held altcoins to ETH and BTC. We hold zero exposure to these coins. Prime Trust has lost access to the vast majority of held assets. Traders are abuzz with TUSD FUD. We are not concerned about the TUSD peg, though we hold no exposure. Our TOs are looking into arbitraging TUSD if it significantly loses peg.
Our View and Strategy
Interest rates have stopped increasing as we expected. There is still concern with stocks near all time highs and inflation coming down slowly that rates may further increase later this year. GDP figures indicate a soft landing is still becoming more likely. Both the main treasury and the TOs managed portfolio have invested in new projects we find attractive for high risk adjusted returns.
UwU continues to mature both in price and as a protocol with more adoption happening particularly for those looking for yield on their wMEMO and wBTC; one of the hardest assets in the space to earn high returns on. We are continuing to earn returns in mostly stables paid at around 50% APR on our LP. Users can currently earn over 29% by depositing their wMEMO there.
Sifu tokens continue to be one of our best investments. Their rise from $54 to $62.50 along with the remainder vesting increased our liquid backing per wMEMO by $1,690 alone. These tokens are fully backed and may be redeemed quarterly.
We previously purchased Flex (now $OX) tokens mentioned in the last Treasury Report for $3mm. These tokens have now been successfully sold for $5mm, a profit of 66%.
Interport has seen a stunning increase in usage since last week. A single day of volume was more than the entire lifetime of the project prior to this. We are looking forward to a bright future for ITP. Our backing price will gain a significant boost as these tokens vest and become liquid.
From the Treasury Operators:
We have done a $150k seed investment into Daisen, which is a fully on-chain non-custodial platform offering a CEX-like experience. Their mission is to enhance transparency and security while lowering the friction/entry barrier into DeFi. They will be launching on Arbitrum in the near future.
We own 10% of outstanding tokens.
We have also done a seed investment into Savvy, which operates similarly to Alchemix. It is a protocol that offers non-liquidating, self-repaying loans; or credit on your future yield. We invested $150k for 1% of the outstanding tokens, with a 2 year vesting schedule.
Savvy is currently live on Arbitrum.
We’re compounding some directional positions to accumulate as much as we can while reducing cost basis. We are also part stables as we see risk in the market. This is working out in our favor as the portfolio is seeing significantly lower drawdowns than the market in general.
We are also working on arbitrage opportunities together with Bastion Trading.
Treasury Spreadsheet
Liquid treasury April 1, 2023: $113,924,122.00
Liquid treasury June 29, 2023: $126,536,467.00
Buybacks are continuing to push the price higher and earn a profit for holders. We are now breaching the $32k level on each one. Purchased wMEMO tokens are sent to the treasury and removed from circulation. Our supply went from 3365.6 to 3252.7, a reduction of 3.5%. This accounts for an effective additional profit of over $3mm.
wMEMO began with a backing of $33,849 on the 1st of April. The current liquid backing as of the 29th of June with all management and performance fees paid stands at $38,396. Full backing stands at $39,937.
We have single sided buy only LPs set up through Sifuvision to purchase from those that want to sell. wMEMO in the treasury is not for sale at current prices because it would reduce backing for holders. All available wMEMO within LPs on all chains is user owned and considered backed.
