Technical
Architecture
How memento sources yield, structures capital, and bridges traditional finance with on-chain infrastructure.
System Overview
memento is a hybrid yield platform that enables on-chain depositors to access returns from traditional financial markets. The core innovation is our capital structure: user USDC remains on-chain at all times while a banking partner provides parallel fiat capital for TradFi execution.
This architecture solves the fundamental problem of bridging crypto and TradFi: how do you give on-chain users access to off-chain yields without requiring them to off-ramp, go through KYC, or wait for settlement?
Capital Flow Architecture
Deposits USDC
Holds USDC on Solana
Mirrors with fiat
Dividend stocks
REITs
Cashflow businesses
The Banking Partnership Model
The core of our architecture is the relationship with our banking partner. This is not a traditional custody arrangement. Instead, it is a capital mirroring agreement that enables instant on-chain liquidity while accessing off-chain yields.
How Capital Mirroring Works
Why This Structure?
For Users
- No KYC required for vault access
- Instant withdrawals (no T+2 settlement)
- On-chain verifiable deposits
- No counterparty risk on user funds
For the Bank
- Earns a share of strategy yields
- USDC collateral secures their position
- No direct crypto custody required
- Operates in familiar regulatory environment
Collateralization
Vault Strategy Details
We operate five distinct vaults, each targeting a specific yield source. All strategies are executed by memento using capital provided by our banking partner.
Dividend Delta-Neutral
9-11% APYThis strategy isolates dividend yield from equity price movements through systematic hedging. The goal is to capture corporate dividend payments while maintaining zero net exposure to stock market direction.
Strategy Mechanics
- Build a basket of 20-30 high-dividend stocks
- Focus on utilities, telecoms, consumer staples, REITs
- Short equivalent notional in index futures (S&P 500, sector ETFs)
- Rebalance weekly to maintain delta neutrality
Yield Sources
- Quarterly dividend payments from underlying stocks
- Futures roll yield when in backwardation
- Securities lending income on long positions
- Cash interest on margin collateral
Risk Profile
Primary risks include dividend cuts, basis risk between stock basket and index hedge, and execution costs during rebalancing. The strategy has low correlation to broad market movements.
Basis & Funding Arbitrage
11-13% APYThis strategy captures structural inefficiencies in crypto derivatives markets. Perpetual futures and quarterly futures often trade at premiums or discounts to spot prices, creating arbitrage opportunities.
Basis Trading
- When futures trade at premium: long spot, short futures
- Lock in the basis spread as guaranteed profit
- Close position at expiry when basis converges to zero
- Returns vary based on market conditions and funding rates
Funding Rate Capture
- Perpetual futures have 8-hour funding payments
- When funding is positive: longs pay shorts
- We go short perp + long spot to collect funding
- Position is delta-neutral (no directional exposure)
Execution Venues
Trades are executed on regulated venues including CME (for BTC/ETH futures), Deribit, major centralized exchanges with proper licensing, and decentralized exchanges (DEXs) on Solana. All positions are fully collateralized with no leverage beyond 1x.
REITs / Real Estate
12-14% APYReal Estate Investment Trusts are required by law to distribute at least 90% of their taxable income as dividends. This creates a reliable income stream backed by physical real estate assets.
Portfolio Composition
- Diversified across 15-25 REITs
- Sectors: residential, industrial, healthcare, data centers
- Focus on high-yield REITs with stable occupancy
- Avoid development-stage or highly leveraged REITs
Income Sources
- Monthly or quarterly dividend distributions
- Rental income from commercial tenants
- Property appreciation (realized on rebalancing)
- Special dividends from property sales
Risk Profile
REITs carry real estate market risk, interest rate sensitivity, and sector-specific risks (e.g., office REITs vs. industrial). This vault has higher volatility than delta-neutral strategies but offers higher target yields.
RWA Cashflow
15-20% APYThis vault invests in fractional ownership of cash-generating small businesses. These are boring, predictable businesses that throw off consistent weekly or monthly cash flows.
Asset Types
- Laundromats: Coin-operated, 70-80% gross margins
- Car washes: Express tunnel or self-serve
- ATM routes: Surcharge income from placements
- Vending: Snack, beverage, specialty machines
Due Diligence
- Minimum 3 years operating history
- Audited financials or verified bank statements
- On-site inspections before acquisition
- Professional management agreements in place
Risk Profile
RWA investments are illiquid and carry operational risk. Individual businesses can underperform or fail. We mitigate this through diversification (10+ assets per vault) and professional management oversight. This is our highest-risk, highest-reward vault.
Stablecoins
13-15% APYThis vault deploys USDC across battle-tested DeFi lending protocols to earn yield from borrowing demand. These protocols have billions in TVL and years of security track record.
Protocol Allocation
- Aave: Largest DeFi lending protocol, $10B+ TVL
- Jupiter: Solana's leading DEX aggregator and perps platform
- Spark: MakerDAO's lending arm, backed by DAI
- Pendle: Yield tokenization for optimized returns
Yield Sources
- Interest from borrowers (variable APY)
- Protocol incentive tokens (AAVE, COMP, etc.)
- Yield optimization via Pendle PT/YT tokens
- Cross-chain arbitrage opportunities
Risk Profile
Primary risks include smart contract vulnerabilities (mitigated by using only audited, battle-tested protocols), variable interest rates, and potential depeg events. This is our lowest-risk vault due to the maturity and security of the underlying protocols.
Yield Settlement Process
Understanding how yields flow from strategies back to your wallet is important for setting expectations around timing and amounts.
Yield Accrual
As strategies generate returns (dividends paid, rent collected, funding received), the income accumulates in our TradFi accounts. We track performance daily and reconcile against on-chain deposits.
Fiat to USDC Conversion
On a weekly basis (or after significant yield events), we convert accumulated fiat yields to USDC through our banking partner. This uses Circle's institutional APIs for efficient conversion.
On-Chain Distribution
USDC is deposited into the vault program and allocated to depositors proportionally based on their share of the vault. This triggers an on-chain event that updates your claimable balance.
User Claims
You can claim accumulated rewards anytime through the app. There is no fee for claiming. Rewards not claimed continue to sit in the vault and can be claimed later.
| Vault | Primary Yield Events | Typical Settlement |
|---|---|---|
| Dividend Delta-Neutral | Quarterly dividends, daily futures roll | Weekly |
| Basis & Funding | 8-hour funding, quarterly expiry | Weekly |
| REITs / Real Estate | Monthly/quarterly REIT dividends | Monthly |
| RWA Cashflow | Weekly/monthly business cashflows | Bi-weekly |
| Stablecoins | Continuous lending interest, protocol rewards | Weekly |
Withdrawal Mechanics
Because your USDC never leaves the vault, withdrawals are instant and do not depend on TradFi settlement cycles.
Withdrawal Flow
The key insight is that steps 1-3 happen instantly on-chain. Steps 4-5 happen asynchronously and do not affect your withdrawal timing. You get your USDC immediately; the bank settles their side on their own schedule.
Withdrawal Limits
Risk Management
We employ multiple layers of risk management across both on-chain and off-chain operations.
On-Chain Security
- Audited Solana programs (non-upgradeable)
- Multi-sig admin controls for parameter changes
- Rate limiting on deposits and withdrawals
- Emergency pause functionality
TradFi Risk Controls
- Position limits per strategy and asset
- Stop-loss triggers for drawdown protection
- Daily reconciliation with banking partner
- Segregated accounts per vault strategy
Operational Security
- 24/7 monitoring of all positions
- Automated alerts for anomalies
- Regular third-party security reviews
- Incident response procedures
Counterparty Management
- Banking partner is a regulated institution
- Brokers are SIPC-insured (where applicable)
- No single counterparty concentration
- Regular counterparty credit reviews
Infrastructure Partners
We work with established institutional partners across the TradFi and crypto ecosystems:
| Function | Partner Type | Role |
|---|---|---|
| Capital Partner | Regulated Bank | Provides 1:1 fiat capital mirroring USDC deposits |
| Prime Brokerage | Institutional Broker | Executes equity, REIT, and derivatives trades |
| Custody | Qualified Custodian | Holds TradFi assets in segregated accounts |
| USDC Operations | Circle | Handles fiat-to-USDC conversion for yield settlement |
| RWA Sourcing | Asset Managers | Sources and manages real-world asset investments |
Partner Disclosure