Ribbon Finance

Risk profile

Ribbon Earn is designed to be an all-weather yield product, much more akin to a “set and forget” strategy that users do not need to actively pause-resume based on market conditions. People who are looking for a place to earn yield on USDC, and want some exposure to the market volatility, may find Ribbon Earn the right product for them.
It is important, in any case, to understand the risks associated with the investment: Ribbon Earn generates yield through lending, which has credit risk; market makers taking the other side of Ribbon Earn trades carry credit risk and could potentially default in the case of extreme events. This means that both the principal and yield invested could be lost in the event of market makers defaulting. However, to minimize this risk Ribbon select a basket of leading accredited crypto market makers, whose credit assessment passed strict requirements set by Credora, the leading real-time credit underwriter in crypto.
In the situation that the knock-out options expire in-the-money, sellers of the knock-out options structure may be unable to fulfill part of their obligations to the vault.