Product Structuring
Last updated
Last updated
USYC is issued by Circle International Bermuda Limited, regulated by Bermuda Monetary Authority (BMA), and represents an interest in a Cayman Islands mutual fund licensed by Cayman Islands Monetary Authority (CIMA)
Tokens represent shares in the fund, thus all token holders need to be onboarded and KYC/AML’d to be able to own SDYF shares. The fund administrator moves shares in the SDYF share registry to reflect movements in the USYC token.
Once an investor is onboarded to SDYF, their wallet address is added to the Allowlist, and permission is granted to hold USYC. The investor sends stablecoin USDC or USDT via our Smart Contract Teller. Hashnote then transfers the investor's funds to its Prime Brokerage to invest into T-Bills and enter repo/reverse-repo agreements.
The investor's ownership of this fund is reflected on a blockchain via a permissioned ERC-20 smart contract. Hashnote mints into the investor’s wallet an amount of USYC tokens equivalent to the number of shares the investor has in the SDYF.
The amount of USYC the investor receives is equal to the deposit amount divided by the current price of USYC.
Any client wallet on the Allowlist and granted permission to hold USYC can also redeem USYC into USDC with Smart Contract Teller.
The client's redemption of the USYC token will be reflected in the fund registry by our fund administrator.
Ownership in SDYF is represented as shares at the Transfer Agent, and whose digital twins are represented onchain as a Smart Contract token (ERC-20 specification). The onchain representation introduces additional utility beyond what has been historically possible in traditional finance.
Entitlements are the gatekeepers to most of the functionality of USYC. The wallets associated with KYC’ed entities receive a Role that entitles them to hold and transfer the token.
The USYC Smart Contracts queries the Entitlements contract to verify the caller of a transaction has the appropriate permissions to perform a transfer or to receive the token.
The Entitlements contract can also freeze all transactions involving USYC. As every type of action involving USYC verifies the Role of the sender, the Allowlist is positioned to revert all transactions. In the event there is suspicious activity, Hashnote has the ability to prevent any transaction from being completed. Only after the situation has been resolved, will the Allowlist be put back into a state that allows the token to be transacted on.
To help investors enter and exit their positions efficiently, we provide a Smart Contract Teller to facilitate investing in the fund and liquidating the asset onchain.
Through the Teller, investors can subscribe to USYC with USDC or USDT 24/7/365. Each stablecoin has an after-hours threshold1, and any after-hours subscription will be subscribed at the next business day's price. This price is calculated in advance based on the current interest rate generated by the fund.
1For subscription funds arriving after 2 PM EST, USYC shares are minted on the next business day.
In addition to checking that a wallet is permissioned, the Entitlements contract also performs OFAC sanctions checks by querying an onchain oracle for matches to sanctioned addresses. The oracle is maintained by.
The Smart Contract Teller provides USYC holders immediate liquidity for USYC. At any time of the day, investors can redeem USYC at the latest reported price through the Teller. You can view the liquidity available on the USYC page in real time. If you require more liquidity on a specific day, please contact us at .
