How Does It Work?
What is Fume?
Fume is a fund management tool to automate administration with smart contracts.
Implementation
On-Chain Fund
Fume leverages blockchain technology to provide selective transparency to investors through Zero-Knowledge Proof (ZKP). This means that NAV history is stored on-chain in an encrypted manner. Fees can be claimed/paid automatically, and everything is traceable, since it is stored on a public blockchain. Following a traditional KYC procedure to comply with AML regulations, Investors are able to subscribe by directly sending funds to the fund's smart contract (address).
Blockchain Agnostic
The goal of the protocol is to build a platform that can be easily used on different blockchain solutions of choice. The development will start laying its foundation on Ethereal, as well as on Polygon. These networks offer strong security and additional services needed by the protocol. The first deployment will take place on those chains. In a second step, the protocol will allow assets to also be stored on other chains, as well as off-chain.
For the Fund Manager
1. Manager Onboarding
The Fund Manager provides the KYC documentation to initialize the onboarding.
2. Offering Memorandum
Definition of the Fund’s Terms & Conditions. Fee schedule, Lock-up period, Eligible Assets.
3. Legal Registration
The Fund undergoes legal registration (1-2 weeks) in the respective jurisdiction and obtains an ISIN code.
4. Fund Deployment
The Manager sets up its multi-sig wallet to deploy the Fund’s smart contract.
5. Fund Page Customization
The Fund web portal is customized and released online (logo, color palette, domain).
6. Distribution
The Fund is now live. The Manager can start onboarding investors and define the portfolio allocation.
For the Investor
1. Fund Review
The Investor reviews the Fund’s Terms & Conditions online. Either publicly available or granting personal access.
2. Wallet Connection
A personal wallet or third-party custodian is connected to manage the investment.
3. KYC Procedure
The KYC procedure is performed to ensure compliance with collective investment schemes.
4. Send Capital
After the onboarding approval, the Investor’s wallet address has been whitelisted and it can thus deposit.
5. Follow the Investment
Any Fund activity can be transparently tracked on the platform.
6. Redemption
According to the lock-up terms, the investor can redeem the investment by withdrawing the underlying assets.
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