Investment Mandate for Asset Managers

To ensure a transparent and methodical approach to allocating capital to this strategy, Midas has established a set of guidelines for our asset managers. These guidelines define the types of instruments and tokens that are eligible for trading under the mBASIS strategy. The following constraints outline some of the criteria we consider:

• Minimum Dollar Notional Average Open Interest: We require a minimum level of open interest in perpetual contracts to ensure sufficient market participation and liquidity.

• Fundamental Criteria: Factors such as project age, market capitalization, and other fundamental metrics are evaluated to determine the viability of potential trades.

• Volume, Orderbook Depth: Instruments with high trading volume and substantial orderbook depth are prioritized to ensure adequate liquidity and efficient execution.

• Collateralization: For positions involving cross-collateralization, we mandate that the collateral haircut of any asset remains below a certain threshold to manage risk effectively.

• Auto-Compounding PnL: Profits and losses received from funding are periodically auto-compounded to enhance yield generation.

As part of our mandate, during volatile or unfavorable market conditions, our asset managers are directed to allocate funds into US T-Bills via our core product, mTBILL. This protocol provides a safe haven and ensures a stable yield, optimizing capital allocation when market opportunities are limited. Our asset managers meticulously consider these metrics, accounting for factors such as volatility, market liquidity, and transaction costs. This approach enables us to dynamically fine-tune execution parameters, ensuring optimal spread efficiency and maintaining the integrity of our investment strategy.