Creating Instructions for Closed-End Products

Protocol introduction

➢ Closed-end products are more suitable for complex investment logic and strategies.

➢ The portfolio manager needs to conduct fundraising for the product before managing the product.

➢ After the fundraising is completed, it will enter the operation period. During the entire operation period, the share tokens can not be redeemed, but they can be exchanged in the secondary market.

➢ After the operation period ends, the product will be liquidated, and investors who hold share tokens can retrieve the corresponding portfolio assets through the redemption function.

The protocol process is divided into 5 steps

Step 1: Select the protocol

Before starting minting, you need to link your wallet and authorize it. Currently, DeSyn has three types of portfolio templates for you to choose from, including open-end ETF, closed-end, and customized.

Please select a closed-end portfolio template.

Step 2: Set parameters

There are a total of 11 items of template available for setting in the parameter setting link of closed-end portfolio product.

Basic settings

➢ Product name: Give your product an awesome name, within 50 letters or numbers.

➢ Product abbreviation: To make it easier for investors to remember, set an abbreviation for your product, within 10 letters or numbers.

Fundraising settings

➢ Closed-end operation period:

There are three options for the length of running the portfolio operation: 90 days, 180 days and 360 days.

You can set it according to your needs. This time is calculated from the end of the fundraising, excluding the fundraising time.

➢Fund Raising period:

The time is when the product conducts fundraising in the market, and investors can invest in the product within this period.

No new investment will be accepted at the end of the fundraising period.

You can set the length of the fundraising period according to size of the investment, market popularity, social network and other information, and it generally does not exceed one month. It is recommended to warm up the market before starting the fundraising period, so that when the fundraising period starts, the assets can be transferred to the account quickly.

➢ Fundraising token:

The token you are willing to accept from investors in the product. At present, it mainly supports tokens with high consensus in the industry, including BTC, ETH, USDT, and USDC.

➢ Size of Issuing:

You can set this parameter if you have requirements on the size of the fundraising.

After setting, if the assets raised are less than the lower limit of the size, the product will fail to be established;

If the assets raised meet the upper limit of the size, the fundraising function will be closed and the product will start to operate immediately.

Please set it carefully.

Fee rate setting

➢ Issuance fee:

You can charge investors a certain fee for expenses during the product release process. The fee ratio should not exceed 10%, and it is recommended to be around 2%.

➢ Redemption fee:

You can charge the investors a certain fee to pay for some expenses during the redemption process. The fee ratio cannot exceed 10%, and it is recommended to be around 2%.

➢ Management fee:

The management fee is your main income for managing products, and the fee ratio cannot exceed 10%, and it is recommended to be around 2%.

➢ Performance fee:

In order to motivate managers to create better performance, you can set a fee ratio to share excessive profits with investors. When the product makes a profit and is liquidated, the contract will distribute the product profit according to the fee ratio.

Advanced settings

➢ Investor white list:

If the products you release need to comply with local regulations, such as soliciting for specific people with certain qualifications, you can enable this function. After it is turned on, only the address in this white list can conduct the issuance and redemption of this product.

➢ Authorized administrator

You can authorize multiple individuals and organizations to manage products with you. This permission only includes the ability to rebalance, but not transferring product owner permission and etc.

➢ Asset income distribution

You can use this function to distribute the income generated by asset management products to portfolio managers.

➢ the White list of investment assets

This function is mainly used to constrain the type of investment assets, and you can activate it when the investment scope is very certain. Once it is turned on, you can only invest assets within this target list, and it cannot be changed again.

Step 3: Set creating information and income distribution

In this process, we carry out minting settings and income distribution settings of share tokens.

○ Share Token Settings

➢ In V2, you need to invest some assets to initialize the product.

➢ You decide initial capital you like to invest during the initialization according to your own situation, and then set the corresponding number of shares that you expect to mint.

➢ We will estimate the net value of the issuance based on the current price and quantity of your invested assets, as well as the number of share tokens expected to be minted, for your reference.

➢ Expected net value = number of assets * asset price/number of minted shares.

○ Revenue distribution settings

➢ The revenue distribution setting is a special feature of the DeSyn Protocol, and currently, it is mainly piloted in closed-end portfolios.

➢ A reasonable distribution method of product income will greatly facilitate the fundraising, management, and operation of products.

➢ This is a very interesting experiment!

○ Types of income to be distributed

Closed-end asset management products can create four types of income:

➢ Issuance fee

➢ Redemption fee

➢ Management fee

➢ Performance fee

○ The method of income to be distributed

distribution of income

➢ DeSyn platform: DeSyn platform charges a fixed fee ratio for platform operation.

➢ Fundraising partner: A fundraising partner who helps fundraising can get a commission fee set by the portfolio manager

➢ Portfolio manager: All the remaining income belongs to the portfolio manager, and the portfolio manager can redistribute this part of the income.

○ Configuration of incentive fee

➢ Fundraising is an important part of the operation of all asset management products. As an excellent manager, you can reasonably distribute income to team/community members to help the product succeed.

○ You can determine different incentives based on the performance of fundraising partners.

○ We support you in setting up an incentive system up to four levels.

○ The distribution income corresponding to each tier cannot exceed 100% at most. For example, if you plan to raise 1 million USDT, the allocation tiers of the issuance fee are set to 0~ 250,000 respectively and the allocation ratio is 25%.

○ If a fundraising partner raises 200,000 USDT, which belongs to a certain target level set up by the manager, then he can get 25% of the issuance fee corresponding to 200,000 USDT.

○ Assuming that the issuance fee is 1%, the fundraising partner can get 200,000 times 1% and then 25%, which is equal to 500 USDT.

○ The fundraising partner can get an issuance fee incentive of 500 USDT. The remaining target levels, redemption fees, management fees, and performance fees will follow the similar path.

Step 4: Data on-chain

➢ After completing the product settings, we will use the smart contract to save your settings to the protocol. This process will take a certain amount of time, please wait patiently.

➢ In the process of that smart contract goes on chain, you need to authorize the transaction and pay the gas fee. Please ensure that the wallet link status is normal and the relevant assets are sufficient.

➢ Our program will give you feedback on the results in a timely manner after completing the completion of product smart contract on-chain process.

➢ You can click the Retry button to know the progress of the smart contract on the chain process.

Step 5: Successful issuance

➢ When you see this page, congratulations, your portfolio product has been successfully released.

➢ Click [View Details] to view the products you issued.

➢ You can send the address of the product to your friends, and investors or post it on social media to attract investors to join your product.

➢ The greater the ability, the greater the responsibility. We expect you to become an excellent manager and achieve amazing results.

➢ If you have any questions, please [Join Our Community] anytime!

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