Our deployment strategies

This section details Noon's deployment strategies, expanding to more strategies over time.

Our initial deployment basket

We started Noon with two strategies in our deployment basket:

1. Cash and carry trade, or Funding rate arbitrage: Our algorithms will buy the spot (long) and sell the perpetual future (short) of highly liquid crypto currencies (e.g., BTC) to build delta-neutral positions that earn us the perpetual future funding rate

2. Tokenised Treasury Bills: We use on-chain protocols that tokenise US treasury bills to buy short term US Treasury Bills and collect the interest rate

New strategies in our deployment basket

Via our Governance Forum, our community has discussed a number of additional low-risk deployment strategies to add to our basket. After the discussion, we have voted to add the following strategies to our deployment basket:

1. Collateralised Loan Obligations (CLOs): Following a thorough analysis of various assets and funds within the CLO asset class, we chose to allocate capital to Janus Henderson’s JAAA. CLOs are structured credit instruments backed by diversified pools of corporate loans. Historically, they have delivered returns above Treasury bills while maintaining relatively low volatility, strong liquidity, and robust institutional participation.

2. Private Credit Funds: After evaluating the Private Credit asset class, we decided to allocate capital to Fasanara’s Fintech Tactical Credit Fund (F-TAC), which invests in short-duration, fintech-originated private credit assets such as SME loans, consumer credit, and trade receivables. The strategy leverages data-driven underwriting and diversified exposure across loan originators to generate consistent yield with low correlation to traditional markets and limited duration risk.

3. DeFi Lending: Deploying assets into top-tier lending protocols like Euler and Morpho, into vaults curated by the most reputable vault curators.

Strategies that were not allowed into our deployment basket

Of course, not all strategies that we discuss in our Governance Forum are approved by our community. The following strategy(ies) have been discussed and voted down, and are therefore not included in our deployment basket:

• Business Development Companies (BDCs): After evaluating and undergoing the first community vote, enabling sNOON holders, the majority voted against adding BDCs as a new deployment strategy due to this higher volatility.

Strategies under evaluation

We are continuously evaluating new strategies to bring the best yields to our users. In this vein, we have ongoing discussions on our Governance Forum to allow our users to join the discussion on new deployment strategies, and participate in the future of the protocol with us.

The strategies we are currently evaluating are:

• Buying PT: Principal Tokens (PTs) on Pendle as a new DeFi yield strategy—offering fixed returns of up to 10–20% APY, with liquidity, transparency, and strict risk controls.

We have also summarised our risk analysis and added useful links in a subsection for each.