Maker Core – Full Strategy Description

Maker Core seeks a return from differences between rates and prices rather than from the direction of the market. It uses the asset you deposit (the "Strategy Asset") as collateral at a trading venue and borrows against it. With the borrowed funds it holds offsetting long and short positions of equivalent delta in the same underlying asset, and it provides liquidity on exchange order books (market making).

The matching of the two legs is what removes the traded asset's price direction from the intended return. The borrowing determines the size at which rate differences are collected.

How to read this document. Sections 2 to 4 describe how the strategy works, what you receive and how your assets are held. They state design and intent, not outcome. Section 5 sets out what can go wrong, and the qualifications to sections 2 to 4 are stated there; it is not an exhaustive list of the circumstances in which a loss may arise. This document is information about a product. It is not investment advice and not a recommendation to deposit; take independent advice if you are unsure.

2.1 Your deposit becomes collateral. The Strategy Asset you deposit is transferred to the Company and placed with the venue as collateral for the strategy's positions. The venue does not credit collateral at its full market price: it applies a discount, commonly called a haircut, set on its own methodology, and it is against that discounted value that the strategy borrows.

2.2 Borrowing. A stablecoin loan is drawn against the discounted collateral value. The strategy is therefore leveraged, working in a range of 8–10x. Where leverage rises towards the thresholds the Company sets, an automated process seeks to reduce positions and bring it back into that range.

2.3 The matched pair. Positions are opened when an attractive rate differential appears across eligible instruments or markets. On Binance the pair typically takes the form of a cash-and-carry (spot-futures) trade: the strategy buys an asset — for example ETH or SOL — on the spot market with the borrowed stablecoins and stakes it, and opens an equivalent short position in the same asset on the derivatives market. The two legs are matched by delta, so a price move is intended to produce a gain on one leg and an offsetting loss on the other, and to increase the margin required on one side while releasing margin on the other. What the pair is designed to earn is the funding rate on the short leg and the staking yield on the long leg, rather than a movement in price.

2.4 Liquidity provision (market making). In parallel, the strategy places buy and sell orders on exchange order books for eligible pairs and earns the spread between them where both sides are filled. Providing liquidity means standing ready to trade with whoever arrives, on both sides of the book. The size the strategy takes in a traded pair is limited to a share of the open interest in that pair on the venue.

2.5 Automated execution. The strategy is executed by automated systems that monitor exposure, leverage, margin level, collateral value, liquidity and execution, and that adjust, rebalance, reduce or close positions as rates, prices, liquidity, collateral requirements, borrowing conditions and execution costs change.

The Company does not publish the parameters, thresholds, models or instrument selection behind the strategy. They are its own and are not disclosed at a level that would allow the strategy to be reproduced.

3.1 Your return is the target rate. You receive the target rate stated in the strategy's conditions in the platform. That rate is shown net of the Company's margin.

The strategy's own result may be higher or lower than that rate. Where it is higher, the excess is the Company's. Where the strategy loses money, the loss reduces the value of your participation, and you may receive back less than you deposited, or nothing. Your upside is therefore capped at the target rate while your downside is not: the target rate is an objective, not a guarantee, and it is not paid where the strategy has not earned it.

3.2 Costs the strategy bears. Trading fees; interest on borrowed funds; funding payments when funding runs against the position; staking costs; network costs; slippage; and other execution costs. These reduce the strategy's result before anything is attributed to participants.

3.3 Fees and conditions. The fees, minimum amounts, withdrawal terms and the target rate applicable to this strategy are set out in the strategy's conditions in the platform, and prevail over any figure repeated elsewhere. Where meeting a withdrawal requires positions to be unwound, the costs of doing so are charged as a separate strategy fee.

3.4 Taxes. Any taxes arising from your participation are your responsibility, in accordance with the jurisdiction in which the Company operates and your own. The Company does not provide tax advice and does not determine your tax position.

4.1 Transfer of assets. When you deposit into the strategy, the assets are transferred to the Company and held in an account opened in the Company's name at the venue. They are not held in an account in your name or on your behalf.

4.2 What you hold. In exchange you hold a contractual claim against the Company for the value of your participation. That claim is unsecured. It is not ownership of, and not a right to delivery of, any identified asset, coin, position or account balance. No trust arrangement, safeguarding arrangement, client-money treatment or security interest applies in your favour, and the assets are not held separately from those of other clients participating in this strategy.

Any balance or value shown to you in the platform is a record of that claim. It is not a statement that a specific asset is held for you. A withdrawal is not the return of the specific assets you deposited. The venue treats the Company, not you, as its counterparty, and you have no direct rights against it.

4.3 One account, all participants. The strategy is executed through an exchange account used for this strategy alone; the Company's other strategies are held in separate accounts. That account holds the assets of every participant in this strategy, across the assets it accepts. Under the venue's rules, all assets in an account form a single collateral pool: margin is calculated, discounts applied and liquidations carried out against the account as a whole, not against an individual participant or an individual deposit asset. A loss, margin call or liquidation arising anywhere on that account therefore reduces the collateral supporting your position — including where it arises on positions relating to a deposit asset other than the one you deposited. Pooling cannot be removed while participants share an account.

4.4 No compensation or guarantee scheme. No insurance fund, compensation scheme, deposit guarantee scheme or investor protection scheme applies to this strategy. The Company has no claim on a venue's own insurance fund, where one exists, for participants in this strategy, and does not rely on it.

Depositing into this strategy involves risk. You may lose part or all of the assets you deposit.

The descriptions of automated systems, monitoring, limits and controls in this document describe how the strategy is designed to operate. They are not undertakings that any control exists at a given moment, will operate as described, or will prevent or reduce any loss. Where this document says positions may be adjusted, reduced, closed or hedged, the Company retains discretion whether to act, when and to what extent. Controls, limits and thresholds are set by the Company and may change. They depend on a market in which positions can be traded, on the availability of the Company's systems and of venue data, and on the Company's model of the venue's requirements — and they are least effective in fast, one-sided or discontinuous markets, the conditions in which they matter most.

5.1 Your collateral is not hedged. Matching the two legs addresses the price of the traded asset only. It does not address the Strategy Asset held as collateral, which is not hedged at any point, so you remain exposed to its price for as long as it is in the strategy. A fall in that price does two things at once: it reduces the value of your participation, and it reduces the discounted collateral value against which the loan and the positions stand — raising leverage and bringing the account closer to the venue's liquidation level. The second effect operates whether or not the hedge is working as intended, and can force positions to be closed at prices the strategy would not otherwise have accepted.

Mitigation: none addresses the price itself. Collateral value, leverage and margin use are monitored and positions may be reduced as the discounted value falls; that shrinks the exposure, it does not offset the price movement.

5.2 The venue decides what your collateral is worth. The venue sets the discount applied to the Strategy Asset and applies a larger one to volatile assets and to assets outside its core list. It may change that discount and its margin requirements unilaterally and without notice. Either raises the margin required or reduces the collateral credited with no market price having moved, and may trigger a margin requirement or forced reduction.

Mitigation: collateral value and margin use are monitored and positions may be reduced in response. Reducing them means selling into the market at the price then available. The discount and the methodology behind it are the venue's and are outside the Company's control.

5.3 Leverage and liquidation. The strategy operates with borrowed funds, so a loss is larger than on the same position held without them. If the discounted collateral value falls relative to the loan, leverage rises, more collateral may be required, and the venue may liquidate positions in part or in full at times and prices it chooses — closing derivative positions, selling assets held on the spot market, and selling the Strategy Assets posted as collateral, in an order it determines, to repay the borrowing. Strategy Assets sold in a liquidation are not recovered. A rise in the venue's margin requirements or in borrowing costs can force the same outcome even where collateral has not fallen. Prices can also move discontinuously, so a level intended to trigger a reduction may be passed before any reduction can be executed.

Mitigation: automatic deleveraging seeks to reduce positions as leverage approaches the Company's thresholds, calculated on the Company's model of the venue's margin requirements. The venue calculates liquidation on its own model, so the process may act too late or on inaccurate assumptions; it does not prevent liquidation. Any additional margin the venue requires is met from the assets of the strategy: you are never asked to contribute further funds, and you cannot owe more than you deposited.

5.4 The income can shrink or reverse. Rates and differentials may narrow, disappear or reverse. Perpetual funding may turn negative and stay negative, in which case the short leg pays rather than receives. A rise in the cost of the stablecoin borrowing can make a position loss-making while it is still fully hedged. After costs, a position may generate no return or produce a loss, and the result of the strategy over any period may be negative — in which case the target rate in section 3 is not earned and is not paid.

Mitigation: differentials are monitored against costs and positions may be adjusted, reduced or closed when a differential no longer justifies them. The rates themselves are set by the market and by the venue.

5.5 The hedge can break, and the venue can break it. Partial fills, delays between the two legs, thin liquidity, slippage, technical failures or the closure of one leg may disrupt the match and leave directional exposure. If one leg cannot be traded while the other moves, the pair is no longer matched even though both positions remain open. Separately, the two legs are different instruments in different markets: the perpetual contract can trade persistently above or below the spot price, and while that gap is wide the movement of one leg is not fully offset by the other, because the shortfall on the derivatives leg is charged against margin in cash as it accrues while the gain on the spot leg is unrealised.

Mitigation: execution is automated and exposure monitored continuously, which is intended to shorten mismatches. It does not remove residual exposure, it does not help where one leg cannot be traded at all, and it does not reach a mismatch the venue itself creates.

5.6 Market making and liquidity. Providing liquidity means posting orders that others choose whether to take. When flow is one-sided the strategy accumulates inventory, and with it directional exposure. Counterparties taking its quotes may be better informed about the next few seconds, so the orders that fill can be the less favourable ones. In fast markets quotes may fill at prices that are already stale, and the difference between two fills can be negative. Thin depth, wide spreads, reduced activity or venue restrictions may prevent positions being opened, adjusted or closed at the expected price, or at all — and in a fast or one-sided market inventory may not be reducible until the move is over.

Mitigation: position size is limited to a share of the open interest in the traded pair at the time it is sized. Open interest is not a measure of the liquidity available to exit, and can itself fall sharply, so a position sized within the limit may come to represent a larger share of the market than when it was opened. The limit does not ensure a position can be closed at a particular price or within a particular time.

5.7 Staking and on-chain protocols. The asset bought on the long leg is staked, so the strategy depends on the protocol that stakes it and on the arrangements around it. Vulnerabilities, coding errors, configuration mistakes, oracle failures, validator penalties, governance actions or malicious attacks may cause partial or complete loss of funds. Changes in protocol reward parameters reduce the return.

5.8 Stablecoins. The borrowing is drawn in stablecoins and stablecoin balances are held. A stablecoin may lose its peg, or be restricted or frozen by its issuer, while the amount owed does not change.

5.9 The venue, technology and access. The strategy is currently executed on Binance alone, so execution, collateral and positions are concentrated at one venue and a single event there may affect substantially all of the strategy at once: operational failure, a cybersecurity incident, liquidity problems, withdrawal restrictions, regulatory action or insolvency. If a venue becomes insolvent, assets held there may be lost. Adding an approved venue would not remove this: assets held at any venue carry that venue's risk, and concentration persists for as long as one venue holds substantially all of them. Automated trading is separately subject to incorrect algorithms, trading errors, software failures, inaccurate or delayed market data, cyberattacks, connectivity problems and outages at the venue, at a data or service provider, or in the Company's own systems — any of which may delay or prevent transactions, including transactions intended to reduce risk.

Mitigation: automated controls cover exposure, leverage, margin, collateral value, liquidity and execution, and are only as accurate as the Company's model of the venue's rules. They do not address the failure of a venue itself: reducing what is held at one depends on its withdrawals and transfers working, which in these events is when they may not. No venue insurance fund or compensation arrangement applies to losses in this strategy.

5.10 Custody, counterparty and the shared account. Assets are held in an account in the Company's name and are not segregated from those of other clients participating in this strategy. Your entitlement is an unsecured contractual claim against the Company, not a right to identified assets: if the Company or a venue fails, recovery depends on that claim and on what can be recovered. Because margin, discounts and liquidations apply to the account as a whole, a loss or margin call arising anywhere on it reduces the collateral supporting your position and may trigger liquidations affecting it, including where it arises on positions relating to a deposit asset other than yours. There is no mitigation for pooling itself; it is a property of the venue's account model.

5.11 Getting your money out. Market conditions, venue restrictions and network conditions may delay the processing of a withdrawal, and such delays may fall in a period in which withdrawal requests are concentrated. Meeting a withdrawal may require positions to be unwound, and the value you receive may be lower than the value shown for your participation when you submitted the request.

5.12 Legal and regulatory. Changes in law, regulation, tax treatment, licensing requirements or venue policy may restrict the instruments the strategy uses, the venues it uses, the assets it holds, or the Company's ability to offer the strategy where you live, and may require positions to be closed at times not of the Company's choosing.

5.13 These conditions arrive together. The risks above are not independent, and the conditions in which each is most likely are the same conditions. In a sharp market-wide fall the Strategy Asset posted as collateral falls at the same time as the traded asset; the venue may raise the discount on volatile collateral in response to the same volatility; perpetual funding may turn negative; borrowing costs may rise; depth thins and spreads widen, so reducing positions costs more; and one-sided flow leaves market-making inventory on the falling side. Each of those raises leverage or reduces available margin, and they arrive at once. Automatic deleveraging then has to reduce positions into precisely the conditions in which reduction is most expensive and least certain, acting on a model of a venue requirement the venue may be changing at the same time. Where the Strategy Asset and the traded asset are the same, or closely linked, a single price movement hits the collateral, the margin required and the positions simultaneously. A loss in such a period is not the sum of the risks taken separately; it can be larger, because the mitigation stated against each one depends on conditions the others have removed.

5.14 Other risks, and past performance. The value and result of the strategy may be affected by market, political, economic, credit, regulatory, operational, technological and other conditions. Past performance is not a guarantee of future results.
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6.1 Changes. The Company may change the operational parameters of the strategy — the instruments and venues used, the assets accepted as collateral, leverage thresholds, position limits, staking arrangements and risk controls. These are risk-management and execution decisions and may take effect without prior notice. The strategy's current conditions are shown in the platform.

6.2 Status of this description. This description explains how the strategy operates. Your relationship with the Company is governed by the User Agreement and the documents it incorporates, including the strategy's conditions in the platform; where this description differs from them, they prevail, and nothing here extends the Company's obligations.

It is a summary. It does not describe every feature of the strategy or every circumstance in which a loss may arise. Statements about how the strategy is designed to operate, how markets or venues behave and how third parties may act are the Company's present understanding, not representations or warranties. Words such as "seeks", "intended" and "designed" describe objectives, not outcomes.

The strategy uses borrowed funds and operates on cryptocurrency venues, where positions can be liquidated. Deposit only an amount you could lose without it affecting your circumstances.

6.3 Definitions. Strategy Asset — the asset you deposit, used as collateral.
​Venue — an exchange or other trading platform used to execute the strategy.
​Discount (haircut) — the reduction a venue applies to the market value of an asset when counting it as collateral.
​Delta — the sensitivity of a position's value to a change in the price of the underlying asset; two positions are "matched by delta" when that sensitivity is equal and opposite.
​Leverage — the size of the strategy's positions relative to the collateral supporting them.
​Funding rate — a payment periodically exchanged between holders of long and short positions in a perpetual futures contract.
​Open interest — the total volume of positions open in a contract on a venue.
​Liquidation — the closing of positions by a venue when margin requirements are not met.