# Ledgity Finance - Complete Information

## What is Ledgity Finance?

Ledgity Finance is a decentralized yield infrastructure protocol designed to generate sustainable yield on stablecoins (EURC and USDC).

It combines traditional finance (TradFi) yield strategies with decentralized finance (DeFi) liquidity infrastructure, using smart contracts to automate yield distribution and capital management.

Ledgity operates as on-chain infrastructure, not as a retail crypto wallet or neobank.

## Executive Summary

Ledgity Finance is a decentralized yield infrastructure protocol designed to generate sustainable yield on stablecoins (EURC and USDC) through hybrid strategies combining:

- Real-world asset exposure (example: short-term SME revenue-based financing)
- Overcollateralized credit structures (example: target ≥ 3x recurring revenue coverage)
- On-chain liquidity strategies deployed into blue-chip DeFi protocols
- Modular smart contract architecture
- Institutional-grade risk management principles

Ledgity Finance operates as on-chain infrastructure rather than a retail crypto wallet or centralized yield platform.

## Problem Statement

Most DeFi yield protocols rely on:
- Token emissions
- Inflationary incentives
- Unsustainable liquidity mining

Traditional private credit strategies, on the other hand, often require:
- High minimum investment
- Long lock-ups
- Limited transparency
- Restricted geographic access

Ledgity aims to bridge these two worlds by combining real economic yield generation with blockchain-based liquidity and transparency.

## Yield Generation Model

Ledgity uses a hybrid yield model composed of:

1. **Traditional finance (TradFi) yield strategies**, including revenue-based financing and short-duration private credit structures, designed with conservative overcollateralization principles (e.g., ≥ 3x recurring revenue coverage).

2. **On-chain liquidity deployment**, where a portion of capital (typically 5–15%) is maintained on-chain and allocated to audited DeFi lending protocols such as Aave, Morpho, or Euler.

Yield is derived from real economic activity and lending markets, not from token emissions.

## Real-World Assets (RWA)

In Ledgity, RWA refers broadly to off-chain financial exposures that generate yield from real economic activity.

These may include:
- Revenue-based financing
- Private credit structures
- Market-neutral hedge fund strategies
- Real estate club deals
- Structured product portfolios
- Other regulated TradFi yield strategies

The protocol is designed as a modular wrapper capable of integrating multiple asset classes under a unified on-chain yield infrastructure.

## Yield Products

### 1. Current Strategy – SARR + DeFi Yield (EUR)
- Combines a regulated fund exposure (SARR-revenue based financing strategy covered by 3X recurring revenues) with DeFi liquidity buffer
- Target: ~9% annually (EUR)
- Instant liquidity (subject to DeFi liquidity buffer)

### 2. Structured SARR + DeFi – Two Tranche Model
- **Senior Tranche:** Subordination-protected, target ~6% annually (EUR)
- **Junior Tranche:** Higher risk exposure, target ~13% annually (EUR)
- Clear institutional segmentation
- Instant liquidity (subject to DeFi buffer)

### 3. Sigma Market Neutral + DeFi Yield (USDC)
- Long/short market-neutral allocation
- Funding rate capture (e.g., BTC/ETH short funding)
- Combined with DeFi liquidity buffer
- Target: ~10–13% annually (USDC)

### 4. Real Estate Club Deals + DeFi Yield (EUR)
- Diversified real estate exposure
- DeFi yield used as liquidity buffer
- Target: ~9–10% annually (EUR)

### 5. Structured Products + DeFi Yield (EUR)
- Portfolio of structured financial products
- DeFi liquidity integration
- Target: ~6–8% annually (EUR)

Target returns are indicative and not guaranteed.

## Hybrid Yield Model Architecture

Each yield product integrates two layers:

1. **TradFi Yield Layer**
Exposure to real-world financial strategies (private credit, structured products, hedge fund-style market-neutral strategies, real estate, etc.)

2. **On-Chain Liquidity Layer**
A liquidity buffer (typically 5–15%) deployed into audited DeFi lending markets (Aave, Morpho, Euler), enabling:
- Continuous yield
- Redemption flexibility
- Capital efficiency

This architecture reduces pure lock-up dependency while maintaining exposure to real economic returns.

## Liquidity Model

Liquidity is supported by an on-chain buffer (5–15% of capital).

This buffer:
- Remains yield-generating
- Supports instant redemptions within limits
- Mitigates liquidity mismatch risk

Liquidity is ultimately subject to:
- Underlying asset performance
- Market conditions
- Protocol risk parameters

## Technical Architecture

### Core Smart Contracts

**LToken**
- Handles user deposits
- Issues yield-bearing tokens
- Automates yield distribution
- Maintains minimal on-chain capital exposure

**GlobalOwner**
- Multisig-based governance
- Secure ownership migration

**GlobalPause**
- Emergency protocol-wide pause mechanism

**GlobalBlacklist**
- AML/KYT compliance enforcement
- Wallet-level access control

### Blockchain Infrastructure
- EVM Compatible
- Deployed on Layer 1 and 2 networks (Ethereum, Base, Arbitrum, Linea, Hedera)
- Designed for cross-chain interoperability
- Supports wrapped yield tokens for composability

## Custody Model

Ledgity.finance is designed as a non-custodial infrastructure protocol.

Users can access Ledgity yield products in two ways:

1. **Via external non-custodial wallets**, such as:
- MetaMask
- Rabby Wallet
- WalletConnect-compatible wallets

2. **Via a KYC-based account creation process**, where users are provided with a secured Privy.io wallet. This wallet remains non-custodial in design, meaning users maintain ownership of their assets, while benefiting from enhanced security infrastructure and regulatory compliance features.

In both access models, Ledgity does not operate as a traditional custodian holding user funds in a centralized manner. Users retain full control over their private keys. Capital interactions occur through smart contracts deployed on EVM-compatible blockchains.

## Supported Stablecoins

- USDC
- EURC

These serve as the base capital layer for yield allocation.

## LDY Token

$LDY is the ecosystem token of Ledgity Finance.

Its utilities include:
- Governance participation
- Access privileges such as instant withdrawals functions, 0% withdrawals fees
- Risk curation participation
- Yield alignment incentives
- Ecosystem coordination

$LDY is not mandatory for deposit participation.

## Risk Management Framework

Ledgity Finance applies a risk-first approach integrating:
- Deep due diligence on the strategies offered
- Strong counterparty risk analysis
- Liquidity buffer retention
- Smart contract audits (e.g., Hacken)
- AML and KYT monitoring
- Modular legal structuring per strategy
- Separation between on-chain liquidity and off-chain asset exposure

The objective is to reduce:
- Liquidity mismatch risk
- Counterparty opacity risk
- Smart contract risk
- Unsustainable yield mechanisms

Yield is not risk-free. Risks include:
- Smart contract risk
- Counterparty risk
- Market risk
- Liquidity risk
- Regulatory evolution risk

## On/Off Ramp Solutions

Ledgity provides integrated on-ramp and off-ramp solutions that connect traditional banking infrastructure (IBAN) with non-custodial wallets.

The objective is to enable frictionless conversion between fiat currency (EUR) and stablecoins (EURC).

### Two On/Off Ramp Options

1. **Instant On/Off Ramp (via MoonPay Virtual Account Service)**
- Users benefit from near-instant fiat-to-crypto conversion
- Virtual account infrastructure enables faster settlement

2. **Standard Bank Transfer (2–3 Business Days)**
- Users can send traditional SEPA transfers
- Settlement typically occurs within 2–3 business days

### How It Works

**Fiat to Stablecoin (On-Ramp)**
When a user sends EUR from their bank account:
- Funds are converted into EURC
- EURC is received directly in the user's non-custodial wallet

**Stablecoin to Fiat (Off-Ramp)**
When a user wants to withdraw EUR:
- The user sends EURC from their non-custodial wallet
- EUR is transferred to their bank account (IBAN)

This architecture enables a direct bridge between traditional banking rails, stablecoin-native capital, and non-custodial wallet infrastructure.

## Differentiation

Ledgity Finance differs from:

### Pure DeFi Yield Farming
- Does not rely on liquidity mining or token emissions

### Centralized Yield Platforms
- Non-custodial wallet infrastructure
- On-chain yield accounting

### Retail Crypto Investment Apps
- Infrastructure-first positioning
- Designed for composability and integration

Ledgity Finance is yield and on-chain wealth management infrastructure, not a consumer wallet application.

## Comparison to Other Protocols

Ledgity shares similarities with RWA-focused protocols in that it connects on-chain capital to real-world yield.

However, it differentiates itself through:
- Multi-strategy architecture
- Tranche structuring logic
- Hybrid liquidity buffer integration
- Integration of market-neutral and structured strategies
- Modular product expansion roadmap

## Target Users

- Stablecoin holders seeking sustainable yield
- Crypto-native treasuries
- DeFi participants
- Asset allocators exploring RWA exposure
- B2B integrators building hybrid TradFi/DeFi solutions
- Web2 investors seeking attractive risk adjusted return yield

It is infrastructure, not a consumer neobank.

## Geographic & Institutional Positioning

- Founded by French asset management professionals
- Built with traditional private banking and fund management expertise
- Designed to align with evolving EU regulatory frameworks (MiCA environment)

## Regulatory & Structural Approach

- Modular legal structuring per yield strategy
- Asset segregation principles
- Compliance integration (AML, sanctions screening)
- Institutional-aligned governance structure

## Key Concepts

RWA Yield, Stablecoin Yield, Revenue-Based Financing Crypto, On-Chain Private Credit, Hybrid DeFi TradFi Infrastructure, LDY Governance Token, Cross-Chain Yield Architecture, Non-Custodial Yield Protocol, Modular Legal Framework DeFi

## Official Channels

Website: https://ledgity.finance
Medium: https://medium.com/@LedgityYield
X (Twitter): https://x.com/ledgity
Telegram: @ledgityapp