FOMO $HIT Investment Fund
Stake $XRD to the 💚ADDIX+FOMO🐸 Node, 100% fees go to buybacks and DeFi positions within the ecosystem, receive airdrops in Alts & xUSDT.
Last updated
Stake $XRD to the 💚ADDIX+FOMO🐸 Node, 100% fees go to buybacks and DeFi positions within the ecosystem, receive airdrops in Alts & xUSDT.
Last updated
On 17th Jan 2025, FOMO & Addix successfully launched the first Investent Fund on the Radix Ecosystem. Investors get exposure to the Fund, simply by staking $XRD to our node. In turn, they receive quarterly airdropped xUSDT in return.
When people stake $XRD to the node, fees are generated (in $XRD) as a reward for validating transactions on the network. Up until this point, 100% of fees generated went into buybacks of both $HIT & $FOMO, which got airdropped weekly.
With this Investment Fund, we will take some fees, and allocate them to interest-paying positions within the Radix DeFi Ecosystem, thus building an investment portfolio. Every quarter, 80% of this fund is paid out in proportion to the weight (time and amount) of those who are staked to the node. That means if one person stakes 1m $XRD for a month, and another person stakes 500k for two months, they would be weighted equally. The remaining 20% stays in the fund to compound.
We have a commitment to the buybacks, and so have designed a strategy where buybacks will never decrease. Every $XRD generated in fees up to the 7m staked to the node at the time of announcement, will go to buybacks. Above 7m staked, half the fees will go to buybacks, with the other half going into The FOMO $HIT Investment Fund.
With this strategy, you keep your $XRD, & simply delegate it to our node. As such, you can always unstake, and reclaim your $XRD whenever you like!
Interest-paying DeFi positions that we place are made with revenue generated from node fees. As such, this is as close to “Risk-Free” as is possible in this space. Of course, there are still risks with Smart Contract exploits, and there is always the opportunity cost of another, potentially better performing option. This option however does not require any new funds to be generated.
It’s simply a case of the more funds deployed into this strategy, the faster the pot grows thanks to compound interest.
The most successful hedge funds operate with a delta-neutral strategy, so whichever way the market moves, they have positions that balance each other out, so the net produces an overall positive picture. This is sometimes considered an “all weather portfolio”.
Traditional Nodes on Radix have 100% exposure to $XRD price. You earn 6.5% interest, paid in $XRD. Therefore you are at the mercy of $XRD price.
Some nodes, including ours, have detached from this slightly by using the fees to do buybacks, then pay out rewards in Alts. Many of these Alts outperform $XRD, and so the strategy is beneficial. However, these Alts still have their main liquidity pools in $XRD, and so remain tied to wider $XRD movements. As such, these are not all-weather.
By taking some of the fees generated, and hedging into other currencies including wrapped assets and stables, we start to spread the risk. This means if $XRD drops, we are holding other assets. These may retain their value in the case of stables, or fluctuate like other wrapped assets - however they are positioned within a lending DeFi position, earning interest.
It was really important for us to keep everything within the Radix Ecosystem. Liquidity within Radix is already small, and we didn’t want to entertain the idea of negatively affecting this. Thanks to Anthic, and wrapped assets, this is now not a problem we need to solve. We can keep everything within Radix, and get exposure to other assets, as well as stables. As we grow, we can also begin to meaningfully contribute to platform liquidity.
There’s a quote attributed to Einstein, that Compound Interest is “The 8th wonder of the world, he who understands it, earns it. He who doesn't, pays it”. The Radix DeFi ecosystem is crying out for liquidity, and so is paying anywhere from 10-50% APY. This means a sensible investment fund can place safe positions in lending markets, and enjoy phenomenal ROI. Over time, this compounds.
Having started the fund with 10,000 $XRD on 17 January 2025, split evenly in xUSDT between Weft and Root Finance lending platforms, the plan is to add 50% of all additional fees generated from the node to this portfolio. As we grow, the portfolio will include other DeFi platforms within the ecosystem, and other assets as well as stables.
We will begin work to include a “FOMO $HIT Investment Portfolio” page to our website too, where people will be able to see what the portfolio holds, and the total amount.
We plan for this to be led by community, and if there are strong calls for the frequency of payouts to be changed, or the payout:reinvest ratio to be adjusted, then those are variables we would be happy to adjust accordingly.
The vision with this is never having to cash out. With this fund, the idea is that as Radix grows, and as the fund grows, we would essentially be paying quarterly dividends, in a stable asset, with your $XRD safely in your wallet, having not sold a single one.
This portfolio would be acting as a way of taking profits, without ever exiting your initial position.
Assumptions: 10,000 $XRD to start, 25% annual APY (well within current range), 82,500 $XRD added to fund each month (achievable when node has 40m staked).
In this example there is 650% growth over 10 years, without selling a single of your $XRD. How we take dividends would be up to the community.
Of course you can do this yourself. However it would involve selling your $XRD to get the position started, then managing DeFi positions, and ultimately deciding when to cash-out.
The great thing about this fund is your $XRD stays in your wallet, and you get exposure to the fantastic APY opportunities within the ecosystem, then receive your quarterly dividend.
The fund could even pursue a more aggressive payout:reinvestment strategy, say 60:40 or 50:50, which would admittedly mean smaller payouts for the first couple of years, but would grow the investment fund in the long run. Again, all without selling a single of your precious $XRDs
By staking $XRD to the 💚ADDIX+FOMO🐸 Node, you are part of The FOMO $HIT Investment Fund, and have a more balanced exposure to the wider crypto & DeFi market.
Beyond 7m staked, 50% of fees go to buybacks of $HIT & FOMO with weekly airdrops, giving you Alt coin exposure.
The other 50% goes into DeFi positions within the ecosystem, paying quarterly dividends in xUSDT, providing you a way to take profits, in a stablecoin, without ever touching your $XRD.
We are super bullish on the future of DeFi taking place on Radix, and are proud to be building the first Investment Fund on this platform.
Two projects which certainly informed our strategising are Phoenix and $DAN. Phoenix's Strategic Investment Fund have been investing in ecosystem projects for a while, & $DAN were the first to do a passive income play on Radix. These two are huge inspirations.
