The following deposit options are currently available for investors. Through a weekly rebalance, investors will see their stackETH/stackUSDC/stackWBTC balances increase and may exchange them 1:1 with ETH/USDC/WBTC.
Rolling fund (deposit / withdraw any time after a linearly decreasing 7-day lockup to prevent rebalance arbitrage)
Sufficient decentralization - all capital is held in a Fund Contract (no direct control by manager)
Checks and balances on Managing Farmer to prevent mismanagement risk
Ability to assign new manager
Ability to charge a management/performance fee from farming rewards
In terms of smart contract risk, these Active Yield Funds are significantly simpler than vault strategies, which are hacked time and time again. Because of their automated nature, vault strategies require extensive code, often rely on pricing data and oracles, and carry vastly increased smart contract risk.
While the Managing Farmer does not take custody of funds, and is limited in what strategies can be utilized through the employment of a DAO-controlled whitelist, a few additional checks and balances have been built in:
Managing Farmer must request additions to the strategy whitelist through a DAO vote
Managing Farmer can be removed at any time by the DAO
Any losses must be reported by the DAO, not the farmer
Managing Farmer may report a max profit of 1% per 24 hours, limiting the ability of the farmer to game the contract even if the Whitelist fails while still allowing for high APY strategies