Yield Farming Alternative Haru Invest Leverages Market Inefficiencies Through Algorithmic Trading – SlateCast #32

Haru Invest offers an alternative to yield farming by providing a custodial solution to exploit market inefficiencies through high-frequency algorithmic trading. Such trading strategies are often reserved for OTC trading firms and hedge funds. However, Haru uses crypto markets to give retail investors access.

Investors deposit crypto like BTC, ETH, USDT, XRP, and USDC into the Haru Invest app, available on Android and iOS, and funds are added to a liquidity pool, which is then used to look for inefficiencies in the market. The strategies rely heavily on arbitration, which is a method of buying and selling assets across multiple platforms where price differences exist.

In the last episode of SlateCast, Haru Invest CEO Hugo Hyungsoo Lee talked about some peculiarities of Haru Invest’s trading strategy. Lee emphasized that Haru Invest employs strict risk management to ensure that the strategies are only exposed to the necessary counterparty risk when holding assets on an exchange.

The core strategies employed by Haru Invest are

• arbitrage trading that takes advantage of the price gap between crypto exchanges
• Market neutral strategy based on the price stability mechanisms on crypto futures exchanges
• spread trading which focuses on the volatility of BTC/ETH futures contracts

Using the above techniques, Haru Invest is able to make profits even in a bear market. However, no method of wealth accumulation can be free from downside risks. It is important to remember that custodial services always come with the counterparty risk of not holding assets in a private crypto wallet.

However, the potential stress and technical knowledge required to participate in DeFi’s current iteration may put some investors off. Additionally, strategies like yield farming require the investor to gain exposure to the underlying assets. Therefore, a neutral approach like that pursued by Haru Invest offers an alternative to entering the world of DeFi or programs offered by centralized exchanges.

A prime example of Haru Invest’s risk management was their ability to close out positions on exchanges like FTX before funds were lost. In addition, Haru Invest operates a risk assessment mechanism for exchanges to facilitate its strategies, which means that if risk levels increase, even profitable strategies will be withdrawn if the stability of the underlying platform becomes unsustainable.

Earn potential at Haru Invest

Haru Invest offers multiple earning opportunities for investors who deposit funds on the platform. The basic offer includes up to 6.5% APR, no lock-up period, unlimited 24/7 withdrawals and daily compound interest.

The Earn Plus product offers up to 14% APR with flexible lockups from a minimum of 15 days to a maximum of 365 days. The Haru Invest team informed CryptoSlate in the latest episode of the SlateCast that the lockup periods are a requirement for certain strategies such as: B. the use of medium to long-term options.

A statement from Haru Invest shared with CryptoSlate reads

“It is important for our members to ensure that there is no financial risk – that is why we do not use risky strategies that are subject to price fluctuations in the market.”

It is important to remember that no investment is objectively “zero financial risk”; However, Haru Invest’s commitment to this goal is paramount to its investment strategy. Assets not actively participating in trading strategies are held at BitGo, a crypto custody solution used by many leading institutional players in the crypto industry. Furthermore, Haru Invest boasts of a strong security history as noted on the website; “No security breaches, no withdrawal freeze, winnings are paid out 100%.”

For more information on Haru Invest’s trading strategies, visit its website.

This article does not constitute financial advice. Due diligence on Haru Invest’s trading practices is limited to publicly available information, along with documentation provided to CryptoSlate by the Haru Invest team. Investors should be aware of all the risks involved before investing any assets with a custody service.

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