Identify Your Most Important Work

Start each day by asking: “What are the two things that would make today exceptional?”

These are your Most Important Tasks (MITs). If you only accomplish these, your day is already a success. For a founder, MITs might include:

• Taking a leap forward on a crucial partnership deal
• Working on a critical technical challenge
• Creating a key investor presentation

Action step: Write your two MITs on a Post-it note and stick it where you’ll see it throughout the day.

Here’s an example of my Most Important Work on a random day:

Break your day into distinct time blocks

Morning, Mid-Day, Afternoon, and Evening. Within each block, list your key activities and commitments. Start your day with high-impact tasks like meditation, journaling, and your most important work.

Schedule specific appointments and routine activities like workouts. Include categories for flexible tasks, items you’re delegating, and things outside your control.

This structured yet flexible approach ensures you prioritize critical work, maintain personal wellness, and achieve a balanced, productive day.

By visualizing your entire day in this format, you can easily identify priorities, manage your energy, and adapt to changing circumstances while staying focused on your most important goals.

Here’s an example of how I’ve time-blocked my day:

Treat Your Plan as Sacred

Once you’ve crafted your daily plan, consider it non-negotiable. Everything on that list is a MUST do. This mindset shift is crucial for maintaining focus and avoiding reactivity.

Remember: Your plan should already account for potential “fires.” If something doesn’t get done, use it as a learning opportunity for future planning.

Pro tip: At day’s end, reflect on any uncompleted tasks. What prevented their completion? How can you plan better tomorrow?

Leverage Your Peak Energy Hours

Identify when you’re at your cognitive best. For many, it’s the morning after sleep, meditation, and coffee. Reserve this time for Deep Work or your MITs.

During these hours, you’re likely to:

• Think more creatively
• Tackle challenging tasks with greater courage
• Enter flow states more easily

Action step: Block out your peak hours in your calendar and treat them as sacred, uninterrupted time.

Actively Manage Meetings and Calendar

Meetings can be productivity killers if not managed properly. When planning your day:

• Review your calendar critically
• Ask: “Is my presence truly necessary at this meeting?”
• Be ruthless in canceling or delegating attendance when possible

As part of your planning routine:

• Consciously decide whether to attend each scheduled meeting
• Cancel or reschedule any that don’t align with your priorities
• Ensure meeting times are clearly defined in your calendar

Remember: Every unnecessary meeting is time stolen from your MITs and deep work.

Separate Planning and Action

Context switching is the enemy of productivity. Dedicate specific times for planning and separate times for execution. This separation promotes flow states and deeper focus.

Try this: Do your daily planning the night before or first thing in the morning, then close your planning tools and shift fully into execution mode.

Schedule Important But Not Urgent Work

Most people struggle to make time for work that’s important but not urgent. As a founder, this could include:

• Long-term strategy development
• Personal skill development
• Relationship building with mentors or industry leaders

Proactively schedule time for these activities. If you don’t, urgent tasks and distractions will always take precedence.

Action step: Block out at least 2 hours each week for important but not urgent work. Treat this time as sacred as you would a crucial investor meeting.

Conclusion

Mastering daily planning is a game-changer for startup founders. By identifying your MITs, treating your plan as sacred, aligning your planning horizons, leveraging peak energy hours, managing meetings actively, separating planning from action, reviewing your calendar daily, and making time for important but not urgent work, you’ll set yourself up for exceptional productivity and strategic progress.

Remember, the goal isn’t just to be busy, but to make meaningful strides towards your startup’s vision. Implement these strategies consistently, and watch as your daily achievements compound into significant milestones for your company.

Over the past quarter, it became more clear to me what the industry’s jargon of “DeFi” and “DAOs” really was, and it became easier to explain to people outside the industry these concepts.

In layman terms, DeFi is an internet-first financial system and DAOs are internet organizations.

Why is an internet financial system important?

We are spending more and more of our working and leisure time on the internet (trending towards 100%) and our internet-first lives require an internet financial system — one that is 24/7, global, permissionless, programmable, and interoperable. This has already been set into motion with DeFi, and I believe that most assets will eventually be represented in digital formats and most transactions will be using this new infrastructure.

We are proud to have helped set in motion the adoption of this internet financial system, and Set is well positioned to capitalize on this trend as we build products and services to serve customers who desire delegated management services. Compared to building a TradFi financial business, building a company on the internet-financial system is exciting as we are able to launch to everyone on the world on day 1 vs. on a jurisdictional basis and seamlessly add new integrations. This means that we will be able to build products quickly, have significantly lower globalization costs, and benefit from the growth of the total addressable market of DeFi.

Why are internet organizations important?

Before the internet, the way that we interacted with people with similar interests was physically through local interest groups and communities such as churches, clubs, and companies. These organizations typically were registered and had bank accounts, so that they could make long-range plans like purchase buildings, create budgets, and hire people. Today, we spend more time on the internet and connect with others all around the world through mediums such as Reddit, Discord, Facebook groups, etc. These platforms bring together folks with similar interests and values, but these communities are unable to do any longer-range planning, hire staff, or make collective purchases. The best they can do is start a GoFundMe for one-time, short-term projects.

DAOs are internet organizations that have internet bank accounts, are able to employ staff, and distribute power to people all around the world to perform necessary functions. That said, most people are confused by the term “DAO”, because it implies that the organization needs to be decentralized (which means they don’t have leadership or hierarchy) and operate autonomously (you can’t make any changes). This couldn’t be further from the truth — which is that functioning internet organizations require leadership and all the structure that traditional organizations need. Most decentralized organizations without leadership or structure have not made significant progress (e.g. Bitcoin) or make decisions by committee (which do not work and results in significant chaos — e.g. Uniswap). The internet organizations that have worked like MakerDAO have clear leadership, a vision / strategy, and various roles in their organizations.

As the way we socialize and organize becomes increasingly native, we expect to see millions of internet organizations be formed. We are proud to be building one of the pioneering internet organizations — Index Coop that today has hundreds of contributors around the world working towards the mission of building a Crypto Blackrock.

We’re excited to announce that Set Labs has raised a $14M Series A round led by 1kx and Hashed! We welcome new and existing supporters including Mechanism Capital, Defiance, Spartan, ParaFi, Coinbase Ventures, Craft, Threshold Ventures, and long-term Set community members.

Set’s Mission to Accelerate the Adoption of DeFi Asset Management

In an internet-first world, we believe in the inevitability of an internet-native financial system (DeFi) that is global, 24/7, permissionless, and transparent. This new system will have all the elements of the existing financial system including trading, borrowing / lending, derivatives, insurance and enable new use cases we can’t imagine today. In this new paradigm, Set’s mission is to accelerate the adoption of DeFi asset management.

Our Progress

So far, we’ve manifested our mission through:

• Index Coop — Crypto’s Blackrock, which provides decentralized exchange traded products (ETPs) such as the DeFi Pulse Index, Metaverse Index and the ETH 2x Flexible Leverage Index. Since inception, we’ve seen enormous growth with TVL recently reaching $400M, the development of a robust community, the cultivation of significant ties with ecosystem partners, and the fostering of a trusted brand.
• Set Protocol — Stripe for Asset Management, which provides asset management infrastructure for anyone looking to launch an ETP or delegated management solution. Customers such as Index Coop, Ember Fund, Yam Finance, and many others use Set for many use cases including social trading, treasury management, and structured product creation.

“Asset management is a core component of financial services, and Set Labs approaches the problem space with a highly crypto-native and community-driven approach.

Set has been able to attract some of the brightest product contributors in DeFi to their communities, which we believe is key to establishing a long lasting competitive advantage.”

- Lasse Clausen, Founding Partner at 1kx

Going Forward

This is just the beginning. We plan to continue advancing our mission by:

• Continuing the decentralization of our protocol and furthering community ownership.
• Building, iterating, and innovating on the suite of financial products offered by Index Coop.
• Partnering with more asset management businesses to deliver end to end solutions.
• Enabling more use cases and increased accessibility through L2 and alternative chain deployments.

Thanks to all for your support so far! If you’re excited about what we’re building at Set and want to work with us, we’d love to hear from you in our careers page!

Set Raises $14M Series A Led by 1kx and Hashed was originally published in Set Labs on Medium, where people are continuing the conversation by highlighting and responding to this story.

After 3 months of operating in public beta, Set Protocol V2’s Asset Management Suite is officially live today! Our mission is to accelerate the adoption of on-chain asset management and we believe that V2 of the protocol gets us closer to achieving that goal.

Learn more at TokenSets, read the documentation, collaborate with the Set team, or join us on Discord.

Motivation

In September, we quietly rolled out Set V2 with the launch of the DeFi Pulse Index (DPI) and the Uniswap Yield Sets, demonstrating the multi-asset, trading, and yield farming capabilities of the protocol. Fast forward to today, Set now secures over $100M in assets across Set’s ecosystem.

Since V2 came out, we’ve seen significant interest from DAO treasuries, DeFi fund managers, and crypto analytics platforms in using Set as an infrastructure solution to power managed accounts and create structured products. Existing solutions are inadequate as:

• Building it yourself is costly, difficult, and requires significant development and security resources.
• Other solutions may not support all the desired user functionality out of the box such as discretionary trades, farming, margin trading, etc. or are permissioned by governance.

Set Protocol V2

Set Protocol V2 is a protocol that enables anyone to create a tokenized basket (“Set”), accept user capital, implement a fee option, and access DeFi. Set aims to be the most trusted, safe, and full featured asset management infrastructure for:

• Developers/Asset Issuers who want to create structured products or social trading businesses.
• Investment professionals who want a low-overhead way to demonstrate a track record.
• Individuals who want to launch a segregated DeFi product for their friends/family (and for potential tax-advantaged benefits — speak to your own CPA about this).

With Set Protocol V2, you are able to:

• Create a Set: Without permission from anybody, deploy a Set — an ERC20 token that represents an exchange-tradable basket of digital assets that has a smart-contract or human manager.
• Accept User Capital: Users are able to mint Sets using a variety of means including basic issuance (bring all the components yourself) and NAV issuance (mint using a single component — coming soon in the UI).
• Make DEX Trades: Integrations with Uniswap, Sushiswap, 0x, 1inch, and KyberNetwork allow Sets to make adjustments to Set allocations.
• Enact a Fee Option: Set creators are able to enact usage based fees such as streaming fees.
• Participate in Protocol Governance: Use tokens in your Set to vote on governance enabled protocols (coming soon on UI, see docs for current use)
• Make Margin Trades: Integrations with Compound and AAVE will allow managers to put up assets as collateral and draw out assets to margin trade (coming soon).
• Lending: Enter money markets such as lending on Aave.
• Participate in Yield Farming (Coming soon): Enter liquidity pools (e.g. Uniswap/Sushiswap/Curve), lending on Aave, and stake tokens to earn yield on Sets.

Set Protocol is open source and anyone can propose new exchanges / adapters on our repository here.

Case Studies

• Index Coop: Set is the underlying infrastructure for the DeFi Pulse Index (~$70M TVL), which has successfully performed trustless rebalances and meta-governance activity.
• Yam Finance: There is significant overhead to DAO treasury management, and Yam is utilizing Set to empower DAOs to make their treasuries productive.
• Ember Fund: Getting started with non-custodial infrastructure is difficult and costly and Ember, a mobile application that enables retail users to invest like a cryptocurrency hedge fund, is utilizing Set to get to market quickly.
• Scifi Finance: Set powers $SCIFI, an anonymously run DAO-governed crypto index with $2M+ AUM already

Security Considerations

While the protocol has been audited for any unexpected interactions, there are still some known behaviors that managers and users should be aware of:

Managers

• Rebase tokens and non-ERC20 are not compatible with the current system: Any Set that holds these tokens may be liable to unexpected dilution/loss of user capital.

Users

• There are no inherent limitations on managers behavior. While managers cannot directly take custody of funds, beware that managers can trade into any token they want. This means legitimate components could be traded for any random token.
• Managers have the ability to adjust streaming fees at their discretion. While fee adjustments are not back-dated, they can be increased up to the maximum amount specified by the manager upon deployment.

While some Sets will be managed by smart contracts that can help curtail these behaviors, know that many will not and that you will be trusting the manager to act appropriately. Additionally, as more features are added there are further behaviors not enumerated here that will need to be taken into account.

Create Your Set on TokenSets Today

Get started with your Set today on TokenSets with a few clicks. With this release you are able to create a Set, make trades using DEX liquidity, and accept capital.

Create Your Set

View Your Set

Manage Your Set

V1 Sets

Existing V1 Sets sets will continue to be supported on TokenSets in the explorer. We will release an update with a migration schedule in the coming weeks.

What’s Next

In the traditional financial world, there are 120,000+ registered mutual funds vs. 16 stock exchanges, demonstrating the breadth of fund products. We expect this diversity and ingenuity to be carried over to crypto, and Set aims to accelerate and empower this activity.

We’re excited about what is going to be on Set V2. Create a Set today on TokenSets, engage with us by joining our discord channel, and sign up here for a deeper conversation with the Set team.

Introducing The Asset Manager Suite was originally published in Set Labs on Medium, where people are continuing the conversation by highlighting and responding to this story.

Key Points

• Today, we’re announcing the Index Cooperative (“Index” or “Index Coop”), a global community that will launch and maintain the world’s best crypto index vehicles
• With community leadership, Index has the opportunity to develop into the world’s largest crypto capital allocators
• INDEX is the Index Cooperative’s native token that enables community ownership and governance, of which 70% is allocated to the community
• On top of an initial INDEX distribution to past DeFi Pulse Index holders (as of Ethereum block #10980212), there is an initial DPI/ETH Uniswap liquidity mining pool.

The Index Cooperative

With the resurgence of token issuance led by the DeFi renaissance, there is a deep need and market for native primitives which enable:

1. Easy access to sectors without purchasing all the underlying tokens individually
2. Methods to hedge against a particular sector
3. Exposure to an asset class without deep knowledge by a broader audience

Index Coop is the first community-led decentralized organization focused on enabling the creation and adoption of crypto index primitives. To achieve this, we hope to see the Index Coop collaborate with the world’s best traditional finance experts, crypto experts and brands to launch/maintain desirable indices, govern critical system parameters with growth in mind, and embed the protocol into as many distribution channels as possible.

The first primitive governed by the Index Coop is the DeFi Pulse Index which was jointly launched a few weeks ago by DeFi Pulse and Set. The DeFi Pulse Index has garnered $2M in assets locked and 1.3k unique holders, demonstrating early product market fit.

The Community’s Opportunity

In the traditional financial world, ETFs and index products are the most widely traded instruments, and companies such as BlackRock ($7.4T AUM) & Vanguard ($6.2T AUM) are the largest asset managers in the world with trillions of assets under management. Currently, we think there is a clear opportunity for the Index Coop, as the first mover, to grow and scale into being a leading provider of crypto index primitives.

As communities have been critical to the growth, development, and sustainability of crypto’s most important projects including Bitcoin, Ethereum, MakerDAO, and Uniswap, the strength of the community will be vital to the future of Index Coop’s success.

If the community works together effectively, we believe the Index Coop’s community has the opportunity to guide one of the most important decentralized financial primitives to widespread adoption.

The INDEX Governance Token

The Index Coop has launched with a native token (ERC20) called INDEX that binds the Index Coop with its holders, enabling community-led ownership and governance. To facilitate sustainable growth, INDEX holders are responsible for important decisions including:

• Adding Indices: INDEX holders are responsible for sourcing, developing, and supporting new index strategies that have broad market appeal.
• Controlling the Community Treasury: To attract a robust set of participants and methodologists, INDEX holders will devise incentive programs to attract and retain index methodologists, liquidity providers, marketers, community, developers, and other experts.
• Updating Fee Configurations: In the traditional financial world, index vehicles monetize through an expense ratio/management fee and/or via asset lending. To enable sustainability, the community will be responsible for finding the correct balance in deploying value accrual mechanisms.
• Enhancing Indice Performance: As components in indices can be used in governance, staked, or lent, INDEX holders will be responsible for determining how to best allocate constituent assets for achieving greatest yield, proper influence, or to satisfy other community-determined goals.

Token Allocation

There will be a total supply of 10 million INDEX tokens with the following distribution:

• Community: 70% that is allocated across an initial distribution, liquidity mining program, index methodologist program, and community treasury
• Team: 30% that is allocated to Set Labs and DeFi Pulse

Community Allocation

Community Distribution

There will initially be a distribution of 1% of all INDEX tokens (100,000 tokens) to past holders and liquidity providers (on Uniswap and Balancer) of the DeFi Pulse Index snapshotted at Ethereum block #10980212 where rewards are based on the following tiered structure:

Set and DeFi Pulse contributions(larger contributors to DPI market cap and liquidity) were removed from the initial distribution. The snapshot was taken at a randomized block in the past, and the distribution tiers are geared towards preventing large ownership from whales or rewarding spam accounts.

If you are eligible, head here to claim your tokens.

Liquidity Mining Program

9% of all INDEX tokens have been allocated to a liquidity mining program. This program will run for a period of 60 days (starting at 12:00PM PDT on October 7th, 2020), and INDEX tokens released under this program are not subject to vesting. More details below.

Index Methodology Bounty

7.5% of all INDEX tokens have been allocated to an 18 month program (beginning at the end of the DPI liquidity mining period) to attract and reward index methologists a share of emitted tokens based on the success of their indices. Rewards are distributed pro-rata monthly based on the total fees contributed to the cooperative by the methodologists’ indices (counted every Ethereum block).

Community Treasury

52.5% of all INDEX tokens have been allocated to a community treasury. 5% of these tokens are available starting today with the remaining tokens (47.5%) being vested linearly at every Ethereum block over a period of 3 years (starting today) in-line with the schedule below.

• Year 1: 50% of the treasury tokens vested (2.375 million tokens)
• Year 2: 30% of the treasury tokens vested (1.425 million tokens)
• Year 3: 20% of the treasury tokens vested (950,000 tokens)

Team Allocation

28% of the total INDEX supply will be allocated to Set Labs Inc. (the company that builds Set Protocol and TokenSets) and 2% will be allocated to DeFi Pulse. These tokens will be vested linearly every Ethereum block over a period of 3 years on the same schedule as the community treasury.

Liquidity Mining Program

A DPI/ETH Uniswap LP token and staking-based liquidity mining program will begin at 12:00PM PDT on October 7th, 2020. The liquidity mining program will run for a period of 60 days.

Initially, the Liquidity Mining Program works as follows:

• Interested users will need to acquire the DeFi Pulse Index (DPI) on TokenSets. A simple UI to do so can be found here, but this is merely an interface layer, and more sophisticated users can interact directly with the smart contract on chain
• Once you have some DPI tokens, head to the Uniswap page for the ETH/DPI pool
• From here, users can add liquidity to the ETH/DPI Uniswap pool in order to mint Uniswap liquidity provider (LP) tokens
• Once you have provided liquidity and received your LP tokens, head to the Index Coop website here
• Connect your wallet and then head to the Farms section
• Here, you can approve your Uniswap LP tokens for staking and then hit Stake to deposit your LP tokens
• INDEX tokens will immediately start accruing to you as reflected on the UI
• When you’re ready, you can simply hit the Claim button to claim your accrued INDEX tokens

Note that, while the Index Coop website provides a simple user interface to interact with the Index Coop farms, it is only a user interface, and sophisticated users can also interact directly with the Index Coop smart contracts on-chain. Over time, we expect and hope to see other UI’s and integrations to emerge for the Index Coop community to utilize.

Governance Process

The Index Coop will follow the principles of progressive decentralization. To that end and to ensure a safe and secure transition that allows the community time to adopt governance responsibilities, there will be an initial transitionary period where the Set team has the ability to make technical and safety-related decisions via multisig before governance is transitioned completely on-chain and over to the community.

What we imagine the governance process could look like:

• Discussions begin on Discord (anyone can bring up a governance topic)
• Proposals can be moved over to the forum for formal discussion if there is enough interest from the community
• Eventually, proposals can then be moved to Snapshot.page for token holder voting (non-binding)
• For now, the multi-sig will implement changes that reach both voter quorum and minimum threshold (which will eventually be moved to on-chain token voting)

Smart Contracts

Note: These smart contracts have not been audited, but are currently using minimally modified Solidity code utilized in the Uniswap and Compound codebases. Ensure you understand any modifications made by using tools like YieldFarming.info’s contract diff checker.

INDEX Token: 0x0954906da0Bf32d5479e25f46056d22f08464cab

Index Coop Multisig: 0x9467cfADC9DE245010dF95Ec6a585A506A8ad5FC

Uniswap DPI/ETH Pool: 0x4d5ef58aac27d99935e5b6b4a6778ff292059991

Uniswap DPI/ETH StakingRewards: 0x8f06FBA4684B5E0988F215a47775Bb611Af0F986

Merkle Distributor: 0xDD111F0fc07F4D89ED6ff96DBAB19a61450b8435

Get Involved

• Check out the official Index Coop website here
• The liquidity mining program begins at 12:00PM PDT on October 7th, 2020
• Join the community on Discord by clicking here

Learn more

Website | Twitter | Discord | Governance Forum

Introducing the Index Cooperative was originally published in The Index Coop on Medium, where people are continuing the conversation by highlighting and responding to this story.

One of the defining characteristics of DeFi is the interoperability, composability, and open collaboration that it enables. Some of the most exciting combinations lie in the intersection of Set, a protocol for tokenized asset management strategies, and bZx, a margin and lending protocol with tokenized positions. When combined, powerful financial products are possible. Here are some of our favorites:

Interest Bearing ETFs and Strategies

Set currently offers Buy and Hold and Range-bound Strategies for both ETH and BTC. Currently these strategies preclude traders from capitalizing on the time value of their holdings. By replacing the current assets underlying these strategy tokens with Fulcrum iTokens and Compound cTokens, it’s possible to no longer have to choose. Traders can capitalize on the time value of their money while executing trading strategies. This gives traders the best of both worlds with minimal downsides.

The Yield Seeker Basket: A DeFi Rebalancer

There are now numerous attempts in the industry to create a product that can automate the process of rebalancing funds to the DeFi lending opportunities with the highest yields. A Set Yield Seeker Basket can automatically allocate and rebalance among the available tokenized interest bearing assets. These are currently Fulcrum’s iTokens and Compounds cTokens. Here’s how it would work:

1. A Dai Yield Seeking Set, for instance, reads on-chain interest lending rates of Dai iTokens and Compound cDai.
2. If the interest rate of Dai iToken is greater than cDai, the Set rebalances from cDai into the Dai iToken. If the interest rate of cDai is greater than Dai iToken, the Set rebalances from Dai iToken back to cDai.
3. The Set can contain any additional logic such as minimum rebalance interval or minimum % threshold to reduce false positive signals. Users now get the best interest rate on their Dai automatically!

Inverse ETFs & Leveraged ETFs

In the traditional financial system ETFs are popular among actors seeking diversified exposure through a single instrument. By placing a variety of popular existing ERC20s together in a basket, a variety of ETFs could be constructed with Set Protocol. However, up until now, those baskets could only provide long exposure without leverage. Fulcrum’s tokenized short and leveraged tokens allows the construction of Inverse ETFs composed of short tokens or Leveraged ETFs composed of leverage long tokens. These sorts of token baskets could be useful for individuals as a simple directional trading strategy or to hedge existing exposure for tax purposes.

Structured Products

A structured product is a combination of two or more instruments that comprise a single asset. Structured products allow the creation of highly customized assets for any type of risk-return objectives, traditionally with the use of derivatives — and can range from simple to highly complex.

For example, an Ethereum enthusiast may want a structured product with long exposure to Ether and short exposure to Bitcoin. With wrapped Bitcoin, Fulcrum’s short tokens, and Set Protocol, the Ethereum enthusiast Set can be created which is made up of Ether and short Bitcoin. With Ethereum-base structured products, it becomes significantly easier for someone to get exposure to products that meet their specific needs.

Learn more about Set and join our community

TokenSets | Website | Medium | Twitter | Telegram | Slack |

Thanks to Kyle J Kistner and Richard Liang for helping to put together this post.

4 Powerful Financial Products Possible with Set and bZx was originally published in Set Labs on Medium, where people are continuing the conversation by highlighting and responding to this story.

This past weekend, Set Protocol’s first rebalances were completed; a huge milestone for us and the Set community. We want to thank our early users of Set for being a part of the first ever rebalances done on our production contracts.

• Sets Rebalanced — Due to the recent price increases of Bitcoin, the BTC Enthusiast, ETH Enthusiast, BTC Range Bound Low Volatility, and BTC Range Bound High Volatility Sets had sufficient price movement for rebalances to be initiated and completed.
• Time to Rebalance — The rebalance process for each Set took about 20 hours to complete, which is composed of an 8 hour proposal period and 11–12 hour rebalance period.
• No Slippage — There was 0% slippage during the rebalance. If you are a Set holder of one of the rebalanced Sets, there was no value lost from your Sets during the rebalance.

Historical rebalances are now on TokenSets on each Set’s detail page!

Frequently Asked Questions

What is rebalancing?

Rebalancing is the process of updating the weights of a Set to enact a predetermined portfolio strategy or desired asset allocation. Rebalances are performed to prevent Sets from straying from its intended strategy or allocation.

The BTC Enthusiast and ETH Enthusiast Sets were rebalanced to return to their target BTC and ETH allocations. The BTC Range Bound Low and High Volatility Sets were rebalanced to capture the price increases in BTC into the non-volatile asset, DAI.

Is rebalancing a taxable event for me?

Taxes vary greatly by jurisdiction. For any financial, tax, or legal matters, we recommend consulting your own professional. While we cannot provide tax guidance, users should be aware that they may recognize short or long term capital gains or losses when selling Sets they’ve acquired.

What are the requirements for a rebalance?

As an end user, you don’t need to do anything. The rebalances are handled automatically without any action that needs to be taken by you.

As for the Sets, are two requirements that are needed in order for a rebalance to occur:

• Rebalance Interval — Typically, portfolios are rebalanced periodically. Each Set has a defined minimum rebalance interval or the minimum time elapsed since the last rebalance. For the Enthusiast Sets, the minimum is 30 days — targeting a monthly rebalance. For the Range Bound strategies, the minimum is 14 days.
• Price Drift — There must be sufficient percentage drift from the intended allocation before a rebalance can occur. For the Enthusiast Sets, the tolerance / drift is 2%. For the Range bound strategies, the tolerances will vary based on the asset due to differences in price volatility.

How does Rebalancing work?

On a high level, the rebalancing process involves a proposal step and the actual rebalance itself.

• Proposal Period — A period where a new allocation is proposed, and users are given a time buffer to opt out of the rebalance if they choose not to have their Sets rebalanced.
• Rebalance Period — A period where the over-collateralized assets are traded out for the under-collateralized asset, returning the weights back to their target allocations.

More detail about rebalance can be found in the FAQ of TokenSets, our whitepaper, or rebalancing article.

The total rebalance time is made up of the proposal period and the time to complete the auction. The current Set’s proposal period are currently 8 hours and the entire auction is set to complete in about 12 hours.

A Milestone Success: The First Sets Rebalance was originally published in Set Labs on Medium, where people are continuing the conversation by highlighting and responding to this story.

Introducing Strategy Enabled Tokens

Today, we’re excited to introduce Strategy Enabled Tokens (S.E.T.? What a coincidence!), tokenized trading strategies facilitated by Set Protocol’s smart contract system. This is a major step towards our mission of making wealth creation tools accessible for everyone.

Motivation

Intelligent portfolio management is a tedious and painful process. It includes manually updating personal positions on spreadsheets and periodically performing trades across multiple exchanges. Even well-intentioned, savvy traders fail to properly oversee their portfolios due to greed, non-action, or cognitive biases.

Existing portfolio management tools such as Wealthfront cannot be used for crypto assets, and are only available to U.S. residents. Fund managers (e.g. Multicoin, Scalar) or trading firms (e.g. Circle, itBit, Cumberland) are available only to select, accredited investors, have high minimums, and high fees. Devising your own customized strategies requires technical knowledge and substantial time to program and maintain systems.

In an ideal world, wealth creation tools should be available for everyone no matter one’s age, geography or current financial situation. These tools should work for any asset — whether securities, commodities, or collectibles. They should be automatic and execute consistently for anyone’s strategy.

Strategy Enabled Tokens

With Strategy Enabled Tokens, setting up your portfolio to mechanize a trading strategy or utilizing best practices such as asset allocation and rebalancing is as simple as acquiring an ERC20 token. The process of realigning the weights based on a predefined strategy is performed via smart contracts with no required action from the holder.

With these Sets,

• Crypto enthusiasts can easily get exposure to passively managed index products that periodically rebalance
• Sophisticated traders can automate trading strategies like buy the dip, long/short, stop loss, or dollar cost averaging.

These Sets allow any customized strategy to be programmed into a smart contract from simple equal weighted index rebalances to complex quantitative strategies. Since Sets are ERC20 tokens, they can be exchanged on 0x, Kyber, or Uniswap, shorted using dYdX, lent out for interest on Compound / Dharma, or potentially used as collateral to borrow on MakerDAO.

How it works

Each Strategy Enabled Token is its own smart contract that conforms to the Rebalancing Set and ERC20 interfaces. Instead of a separate user deciding the next allocation, all the logic and conditions for when, what and how to trade is codified into smart contracts.

These conditions can be as straightforward as “if the price of ETH goes above $1,000, then sell everything into 100% DAI” or as complex as “if the Relative Strength Index (RSI) of BTC falls below 30 on $10B of volume, then convert everything into BTC.”

To determine condition validity, manager contracts can utilize on-chain data sources such as price feeds (e.g. Maker), blockchain state, oracles (e.g. Chainlink), token curated registries, or even prediction market outcomes (e.g. Augur).

Anyone can program their own customized strategy by writing a rebalancing manager smart contract. Therefore, manager contracts can be generated to capitalize on any market condition utilizing any strategy, any data source, and any ERC20 asset.

What’s Next

What we’ve outlined is not just a conceptualization. We are close to protocol code-completion and are at the tail end of code audits from top security firms including Trail of Bits and ChainSecurity. We’ll soon be sharing details about the technical underpinnings in a separate whitepaper and follow-up blog posts and also our plan for a MainNet launch.

If you are interested in creating your own tokenized trading strategy or learning more, message us on Telegram or email us at hello@setprotocol.com.

Learn more about Set and join our community

Website | Medium | Twitter | Telegram | Slack |

Introducing Strategy Enabled Tokens was originally published in Set Labs on Medium, where people are continuing the conversation by highlighting and responding to this story.

This past weekend, the Set Protocol team was proud to attend and sponsor ETHSanFrancisco. We came away impressed by the enthusiasm and quality of projects that came out of the hackathon, especially those built using the Set Developer Platform.

The team kicked off the weekend with a midnight workshop and demo introducing Set’s development tools, and over the course of the next few days, assisted teams every step of the way at our booth. At the conclusion of ETHSF, we awarded $3,000 in total to the 3 best teams that incorporated Set Protocol in their submissions, which are:

Link Set

An app that combines Set’s rebalancing functionality with Chainlink’s oracle price data. We were impressed by the project creating the first fully trustless rebalancing Set without the need for an intermediary needed in traditional Index funds and ETFs.

Primotif

A platform for buying and selling Sets of dYdX futures and Augur predictions using the 0x relayer. The project showed the potential for Set to be combined with other decentralized finance protocols to create even more powerful applications.

CAO

Charitable Autonomous Organization is a platform that hands out bundles of aid. The project highlighted an important non-financial use case for using Sets in nonprofit settings and charitable remittances.

Congratulations again to the winners! We were impressed with all the submissions and make sure to check out all the projects built using Set on Devpost.

What’s Next

We are working hard to incorporate everyone’s feedback into improving our documentation and preparing for launch on mainnet early next year. Looking forward, Set Protocol will be attending ETHSingapore and DeFi Prague, so make sure to stop by and say hello if you will be there!

If you have any questions, start a conversation with our team any time on Telegram. Also, if you find what we’re doing exciting, we’re hiring. Check out our openings here.

Interested in learning more about Set Protocol? Check out:

• Twitter
• Website
• Telegram

Thank you Richard Liang for authoring this post.

Set Protocol ETHSanFrancisco Recap was originally published in Set Labs on Medium, where people are continuing the conversation by highlighting and responding to this story.

The Set Protocol team is excited to be sponsoring ETH San Francisco. At EthBerlin, we were thrilled to see the creation of Bündler, the first Set issuance relayer built by members of the 0x team. Since then, we’ve been hard at work improving setprotocol.js and our documentation.

To help encourage your best work at ETHSF, we will be awarding a total of $3,000 to the three best teams that incorporate Set Protocol in their submissions. Here are a few suggestions on compelling products you can build:

• An issuance relayer that taps into both 0x Protocol and KyberNetwork liquidity. This helps users know that they’re getting the best price for their Set across the DEX ecosystem, while also providing savvy market takers with arbitrage opportunities.
• A ShapeShift-style web app built with setprotocol.js for purchasing and selling Sets. Because Sets are themselves discrete tokens, you can exchange them for one another or even build Sets of Sets
• A rebalancing web app that allows users to explore and participate in Set rebalancing. You can build flows for users to bid in rebalancing dutch auctions and for managers to make rebalance proposals.
• An arbitrage bot programmed to issue and redeem Sets based on market fluctuations. Much like a robo-advisor does in traditional finance, a rebalancing Set can profit using issuance orders directed by algorithmic trading signals.
• A Set-issuing dApp that directly interfaces with Ether, not Wrapped Ether (WETH). The introduction of forwarding contracts with 0x v2 makes one-click Set issuance a very real possibility, and speaks to the value of cross-project integration in decentralized finance.
• A leaderboard website that tracks existing Sets and their financial performance, allowing users to buy into portfolios that align with their investment style. With no need for asset custodianship, Sets can provide this style of decentralized fund management.
• An integrated multisig contract, oracle feed, or Token Curated Registry that serves as a data source for a rebalancing Set. Having a completely on-chain process for programmatic rebalancing enables truly decentralized fund management
• An issuance relayer/application that integrates bundling of Augur prediction shares. Users can buy shares of various Augur outcomes that can be tradeable as ERC20 tokens. For example, you can buy shares of all your favorite sports teams winning in one Set.
• A simple chatbot built on Status that allows counterparties to create, issue or fill Set issuance orders.

We’re Here to Help

If you’re interested in building something using Set, come to our Getting Started with Set Protocol workshop or say hello at our booth at EthSF. We can help you get started in a few minutes. Our dev team will be available the whole weekend to support those working on Set.

If you have any questions, start a conversation with our team any time on Telegram. Also, if you find what we’re doing exciting, we’re hiring. Check out our openings here.

Resources

• Set Developer Platform
• Javascript Library
• Whitepaper

Interested in learning more about Set Protocol? Check out:

• Twitter
• Website
• Telegram

Build with Set Protocol at ETHSanFrancisco was originally published in Set Labs on Medium, where people are continuing the conversation by highlighting and responding to this story.