Greetings from Tbilisi, Georgia!

There is a lot more Sun during the daytime and temperatures are getting warmer, it literally feels that Spring is around the corner.

Last week was another kind of a sucker week for the TerraM token. For the third week in a row, the total value of the token shrunk.

This week's total value lost another -6.23%. Ouch!

There is nothing worth worthy to mention why the total value drop happened this week, as we were not adjusting

The total value shrunk together with other assets classes (read ETH)

Despite the total value decreased (we still rolled up and away from challenged positions, and there is a great chance for recovery in the upcoming months)

With challenged positions rolled away, our 'poor man's crypto hedge fund' for options trading on Ethereum, made quite a decent $97.42 from expiring options trades this week.

All profit was distributed back to the token holders + used to increase liquidity on the Raydium pool. About 7.16% yield in 7 days.

Trades & Profit distribution

We use the capital raised with the TerraM token to sell options on Ethereum, and all profit incurred from options trades is distributed back to the TerraM token. 

Our goal is about 25-30% annual growth

In total, we had 8 options trades expiring on January 27, 2022, we took profit from 3 positions while rolling away 5 positions to Feb 03 and Feb 24 expiry.

All of the roles are recovery trades from the previous weeks. When losing a trade, we try to roll it out for a profit, sometimes it can take a week or two, sometimes longer, sometimes never. We don't book a loss, until we are in recovery mode, also we don’t book a profit if there is a profit in some particular week, but the trade itself yet is underwater.

From the option trades with Ethereum tokens on the Deribit trading platform last week, we were able to book 0.0617 ETH / $97.42 USD profit.

Every week on Fridays (after options expiry on the Deribit platform) we distribute profit back to the token holders + increase the liquidity pool to guarantee enough coin offerings on the Raydium exchange.

As TerraM's total supply is 10,000, this week each token holder received 0.00617 USD per token (97.42/10,000).

Profit was distributed in form of additional TerraM coins to the token holders from the TerraM token address with balances larger than 20 TerraM. Any uninvested token profit was kept on the Deribit trading platform to increase buying power.

Since the inception of the TerraM crypto hedge fund, we have already made and distributed $474.14 or about 34.85% (from the current total token value)

Open options trades

At the time of writing, we are holding 6 options trades open on Ethereum, with the following strikes and expiry dates

• February 03: 2x 1700/1900 call spread(recovery trade); 1x 1500/1400 put spread

• February 24: 1x1700 call (recovery); 1x1500 put; 1x1500X1300 pit spread (recovery trade)

The total ETH amount in recovery: -0.6 ETH

Liquidity pool

We contributed to the Raydium liquidity pool with USDC/TerraM pair by staking an additional USDC 40.85 / TerraM 53.65

• Pool liquidity (TerraM): 297.29 TerraM

• Pool liquidity (USDC): 226.27 USDC

This means that basically anyone can buy/sell 297.20 TerraM coins, which is about 2.97% of the total token supply. We plan to raise and keep our total liquidity on the Raydium pool to about 3-5% of the total coin supply.

Assets under the TerraM token

Most of the assets for TerraM token are held in ETH. Makes sense, as ETH is the coin we trade options with on the Deribit trading platform.

Additionally, we held reserves of 16.6% in USDC, 3.6% ETH, 2.1% in BTC, and 0.6% in SOL

• USDC: 226.27 (+24.69)

• ETH: 0.0309 (-0.1371)

• BTC: 0.00127086 (+0.00023114)

• SOL: 0.347339148 (+0.089228653)

• Tradeable ETH: 0.6638 (+0.0502)

We rebalanced a bit portfolio last week by pouring in ETH from reserves into a Tradeable ETH account

77%. of the total assets are used for actual trades on the deribit platform, while 23% are stored as reserves.

Price:

While we have set the 1:1 ratio exchange ratio between TerraM and USD, on the Raydium network 1 TerraM was trading at $0.82 (-$0.06). That’s an 18-cent discount per dollar.

Swap USDC for TerraM coin on Raydium

The Bottom Line

Despite a value loss, we took this week, we are truly excited at the start of this journey and we hope to be fully invested by mid-2023, until then, there are still 7,390 TerraM tokens available for investment.

Swap some TerraM on the Raydium or simply hit the reply button to learn about other investment opportunities.