A Cross Platform Protocol for Tokenizing Risk

NEPRIV will offer risk-averse investors to participate in yield farming and cryptocurrency investment with minimized risk. Simultaneously, it will also allow investors seeking higher yields to obtain exposure to riskier financial products.

In addition, NEPRIV will give you access to compelling opportunities across DeFi with none of the hassles with Interest rate volatility risk mitigation using debt-based derivatives, Market Price Exposure Risk Mitigation using tranched volatility derivatives. The NEPRIV smart contracts deploy your underlying capital to a diversified set of yield-earning strategies, rebalancing over time to achieve strong yields while diversifying risk, you have access to dynamic exposure by selecting customized risk and return profiles.

NEPRIV will be “platform and asset agnostic,” meaning that it may be able to serve DeFi users on Polkadot, for instance, and may even provide tokenized risk opportunities for synthetic “real world” assets like equities and real estate.

NEPRIV is a decentralized protocol that acts as a yield optimizer for liquidity providers. Liquidity pools in NEPRIV PRIME will collect deposited base assets from liquidity providers and deploy them onto lending platforms to earn interest. However, unlike other yield aggregators, NEPRIV aims to differentiate itself through the introduction of tranches.

One of the biggest issues that yield farming pools face is the effects of impermanent loss. Liquidity providers may lose out on value when the market price of their deposited assets is lower than when it was initially deposited. Through tranches, NEPRIV PRIME aims to provide better exposure to yield farmers and give them the option to select portfolios based on their preferred risk appetite.

NEPRI tokens (NEP) for NEPRIV will be obtained through two (2) methods.

The first method will be buying them from an exchange such as Uniswap.

The second method will be to deposit assets into NEPRIV’s website and earn NEPRI tokens in return for staking. Liquidity providers will earn NEPRI tokens at different rates, depending on the size of their liquidity provided, and the type of tranche they are participating in. However, it should be noted that this method will eventually cease to exist once the circulating supply reaches its maximum cap of 20,000,000 tokens.

Competitive Advantage

NEPRIV is among the first fluctuation derivative protocols. Before the advent of smart contract technology, it was close to impossible to track & attribute yield to a divided allotment of capital, trustlessly & transparently, to provide hedges against any and all fluctuations. Conceptually, you can build derivative products from any type of market-driven fluctuation to hedge various risks. Examples include, but are not limited to, interest rate sensitivity, fluctuations in underlying market price, fluctuations in predictive market odds, fluctuations in default rates across mortgages, fluctuations in commodity prices, and a seemingly infinite number of market-based fluctuations to hedge a particular position.

A standard for tokenizing on-chain collateral

NEPRIV is a protocol for tokenizing on-chain assets, including contracts that otherwise impair access to utilized capital. Tokenized ownership of on-chain assets gives liquidity providers greater flexibility and uninterrupted access to their underlying collateral while enabling leveraged staking and bespoke risk management.

Peer to peer risk exchange

Existing decentralized earning platforms expose liquidity providers to complex code -riven outcomes. Network participants must evaluate an array of catastrophic scenarios where the resulting state could wipe out their holdings or lead to significant impermanent loss. It is hard to anticipate the net effect of extreme market volatility or focused economic attacks. NEPRIV will narrow the set of possible outcomes by giving liquidity providers dynamic exposure.

Dynamic exposure

The first applications of NEPRIV will give liquidity providers the option to select customized risk and return profiles via the use of NEPRIV pool tranches. NEPRIV will separately tokenize the future earnings stream and the net present value of utilized principal in each tranche. Earnings, based on tokenized holdings, are distributed accordingly across all tranches via payback waterfalls.

Payback waterfall

The initial application of the payback waterfall is split between two primary tranches. -A yield enhanced “A” tranche. -A risk mitigated super-senior “AA” tranche.

Added liquidity, when removed, is used to pay back the initial principal of AA holders before paying the principal and interest of the yield enhanced A tranche. In exchange for this enhanced return, participants of the A tranche must stake NEPRI’s native tokens (NEP) to mitigate against failures on the underlying platform (such as Compound, Aave, or Curve). The NEPRIV protocol in this scenario will act as an escrow service for the transfer of risk between A tranche participants and AA tranche participants. NEPRIV will also include a “Y” tranche for allocating liquidity efficiently as it is needed based on a tranche balancing algorithm.