Applicant information
1. Name: Matrixdock STBT
2. Key Information:
Key Product Information
Short-term Treasury Bill Token (STBT) is designed for accredited investors seeking US treasury yields with their stablecoin holdings. STBT currently yields approximately 4.8-5.0% APY on average (as of Jul 2024). Each STBT is pegged to 1 USD and backed by US treasury securities with maturities within 6 months, reverse repurchase agreements collateralized by US treasury securities and cash not exceeding 5% of NAV.
T-bills will be bought with the highest yield in tranches, laddering maturity dates such that there will be access to potential liquidity to support any redemptions without selling any T-bills.
Matrixdock will distribute yield daily through the rebase of STBT in holders token balances. The total STBT supply is equivalent to the Net Asset Value (NAV) of the underlying asset portfolio, which equates to the sum of the market value of US T-bills, Repos (overnight loans fully-backed by T-bills) and cash.
Background
Matrixdock is a digital asset platform that provides access to Real World Assets (RWA) through tokenization. It is a brand fully owned by Matrixport, an all-in-one crypto financial service platform that offers custody, asset management, brokerage and RWA tokenization services. Matrixport currently custodies and manages approximately USD 6 billion of crypto assets. Its client base includes more than 5000+ miners, high-networth individuals, family offices, hedge funds, ventures, protocols and foundations across Asia, Europe, Australia and offshore countries.
Transparency
STBT is the first RWA tokenization project integrated with Chainlink Proof-of-Reserves (PoR) service, with Chainlink’s best in class real-time oracle feed, the integration ensures that STBT is sufficiently backed by US Treasury securities and verifiable 24/7. The STBT contract included Chainlink PoR verification logic to ensure STBT underlying reserves are greater than or equal to the total token supply at all times. Chainlink STBT PoR Feed
3. Expected APY: 4.8-5%
4. Underlying asset(s): T-Bills with maturity under 6 months, Reverse Repos and Cash
5. Minimum/Maximum transaction size: $100k minimum mint, $10k minimum redemption
6. Current AUM for asset: $39.8M as of 1 Aug 2024
7. Volume metrics
Proposal Summary
Brief outline of the requested allocation of Ethena’s Reserve Fund to your asset/product and benefit to Ethena.
Basics and background
1. How will this allocation improve the diversification or capital efficiency of Ethena’s Reserve Fund and/or backing assets?
STBT enables Ethena’s Reserve Fund to diversify its allocation to Matrixdock, a trusted RWA issuer with a proven track record of operating the STBT product for 1.5 years. With over $5M interest distributed to STBT holders, and TVL ATH of over $120M, Matrixdock has demonstrated its ability to mint and redeem large sums of capital without any issues. The volume of transactions LTM is over $800M (including deposits, redemptions, on-chain transactions). As one of the prominent Asia based RWA issuers, Matrixdock also provides diversification in geographical and regulatory risks, where most other T-Bill token issuers are based in other parts of the world.
2. Please describe any experience your firm has in working with decentralized organizational structures
Matrixdock has strong involvement in the DeFi ecosystem, and we are continuously engaging with partners, many of which are in various stages of decentralization. Additionally, our Transparency Panel consists of several key industry players, some of whom had past and current experiences working in DAO structures.
3. What is your entity’s current assets under management, assets held in trust, total value locked, or equivalent metric for your legal structuring?
$39.8M as of 1 Aug 2024
Historical Highest TVL $123.6M on 22 Aug 2023
Legal design
1. Do holders of your product have any shareholder, investor, creditor or similar rights?
Holders of STBT tokens have rights to a debt obligation of the token issuer. Holding of STBT Tokens is redeemable at an amount equivalent to one U.S. dollar per STBT Token of U.S. dollar-pegged Digital Assets less any applicable Fees, trading losses reflecting the value (at the time of redemption) of a pro rata amount of the Underlying Assets (at the time of redemption) and/or transactional costs incurred in connection with sales of Underlying Assets that the Affiliate Entity deems necessary to effect your redemption, subject to additional redemption restrictions.
Product T&C documents will be provided.
2. Describe the legal and contractual structuring for your product, specifically naming any regulatory bodies overseeing the product, if applicable.
STBT is issued under an orphan SPV structure commonly adopted in asset-backed securities issuance by traditional financial organizations, which has the highest degree of credit enhancement. In this legal set-up, Matrixdock plays the role of a service provider and Matrixdock counterparty risk is fully removed because both the token issuance/redemption and the underlying asset management are conducted from this Orphan SPV which itself is a bankruptcy-remote trust.
3. How would the proposed allocation be treated in a bankruptcy or insolvency situation?
This orphan trust structure effectively removed the STBT entities (token issuer and asset holder) from the balance sheet of Matrixdock, and the STBT entities would not be subject to any claims from Matrixdock creditors even in the unlikely event that Matrixdock is insolvent. Given that the STBT entities are special purpose vehicles that only conduct the STBT program, these entities incur no liabilities other than those obligations toward the STBT token holders, which are the only obligations of the STBT entities. As described above, the number of STBT tokens issued will always be less than the dollar value of the underlying reserves held by the STBT entities. With these factors combined, the STBT entities are bankruptcy remote.
Smart Contract/Architecture
How many smart contract audits have been completed with respect to your tokenized product? Please name the auditors and provide a copy of reports.
STBT’s smart contract has been audited by BlockSec and Zellic.io. Audit Report
1. Is the asset/product permissioned? If so, how are you managing user identities? Any blacklisting/whitelisting features?
Whitelist mechanism: The STBT Token can only be minted/redeemed/transferred/held solely by account-holders that have been pre-approved by Matrixdock to satisfy KYC/AML/Accredited Investor requirements.
Whiteslited users can issue a request to whitelist additional addresses via the STBT website by signing a on-chain transaction using the new address or conduct a satoshi test.
2. Is the asset/product present on several chains? Are there any cross chain interactions?
wSTBT is present on Ethereum mainnet and Arbitrum One. Currently, there is a bridge contract between the two chains that uses Chainlink CCIP technology to execute cross-chain transfers of wSTBT.
The contracts have been audited by Blocksec. Contract address: WSTBTBridge | Address 0xC6C1706bF9b034FA8FE5591769261A8b19edeD06 | Etherscan 2
3. Are the applicable tokens being used in any other protocols? Please describe the various components of the ecosystem.
STBT has been used in various DeFi protocols in several functions, including being the underlying assets for stablecoins, yield-generating products and collateral for loans.
At Verified USD foundation, USDV stablecoin is minted using STBT as the underlying RWA token, providing yield to ecosystem participants. At T-Protocol and Term Finance, STBT has also been used in collateralized loans, enabling capital efficiency through its strong composability with lending platforms.
4. How are trusted roles/admins managed in the system? Which aspects of the solution require trust from users?
The permission framework of the STBT contract is broadly classified into three distinct roles: ControllerRole, IssuerRole, ModeratorRole. The proposal is to designate a single smart contract with a timelock function as the controller contract for all three roles. All STBT administrator activities are carried out via this controller contract, with each operation subject to two stages of proposing and executing, and the execution must conform to the delay specified by the timelock. The overall structure is as follows:
Timelock contract: There is a single external control smart contract with a timelock function as the controller contract, through which all STBT administrator activities are carried out. Each operation must go through two stages of proposing and executing, with execution conforming to the 4-hour delay specified by the timelock.
The timelock contract is the only admin, and the security of the STBT contract is normalized to the security of each role involved in the timelock controller: proposer, executor, and canceller. The canceller is one self-hosted hardware wallet that is authorized to cancel an operation scheduled during the timelock period by calling the timelock controller.
5. Is there any custom logic required for your token/product? If so please give any details.
STBT utilizes the whitelist mechanism to determine whether transmission and reception of addresses are authorized.
ERC1400 standard is split into several modular sub-standards：
- ERC1410 defines partially fungible tokens where balances of tokens can have an associated metadata
- ERC1594 defines transfer restrictions and core security token functionality
- ERC1643 defines document management functionality.
- ERC1644 defines controller operation functionality
In particular, the STBT token contract implements the ERC1594 transfer restrictions specs, and the ERC1644 controller operations specs.