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Crypto Yield & Hedging Strategies
Hashnote Harbor
Earn yield on your investments while maintaining the security of custodianship.
Overview
Harbor provides yield on crypto without the assets ever leaving the custodian. Using Hashnote’s proprietary smart contract technology and portfolio management expertise, Hashnote and your custodian offer the unique ability to execute derivative transactions on crypto assets to generate option-yield, while maintaining the security of keeping your assets at the custodian.
How It Works
With Harbor, investors can sell covered call spreads, covered calls, or custom strategies:
Covered Call Spreads
Covered call spread writing is an options strategy that combines selling and buying call options with different strike prices but the same expiration date. This strategy is designed to limit potential losses while maintaining a long position, with the goal of accumulating premium over time that equates to option yield earned.
Hashnote offers low risk strategies (2-4% annualized returns to cover custodial costs and a little bit extra), or higher risk strategies (up to 40% annualized returns).
Covered call spreads are ideal for yield seekers, as investors achieve yield in all but the largest rallies. In the case of a large rally, some of the upside is foregone (see Portfolio Example), reflecting a redistribution of P&L from the most bullish scenarios to all other scenarios.
Sample BTC Covered Call Spread Portfolio
Covered Calls
Covered call writing is a strategy where an investor holds a long position in an asset and sells call options on that same asset to generate additional income from the option premiums. Covered calls can be a conservative way to generate extra income, especially in a flat or mildly bullish market. Miners and other targeted sellers may opt for a direct call selling strategy to augment yields while awaiting a sale.
Targeted annual yields can range from 10% on the conservative side to 40% or more on the more aggressive end of the risk spectrum.
Sample BTC Covered Call Portfolio
Custom Strategies
Investors can also create customized structures to target specific yields, enter into more exotic structures, or create hedges for their assets. Hashnote will work with investors in a bespoke nature in order to create the exact structure that fits their portfolio.
Please contact your custodian or your Hashnote contact for customization discussions.
Custodians
More custodians to be announced soon!
Regulatory Information
Harbor allows access to Hashnote’s private funds, which are managed by Hashnote Management LLC, a registered Commodity Pool Operator (CPO) and Commodity Trading Advisor (CTA) with the US Commodity Futures Trading Commission (CFTC) and a member of the National Futures Association (NFA).
