# Yield Sources & Proof of Reserves

Ledgity’s yield is generated through a **regulated investment vehicle** designed for institutional-grade treasury management.

#### **Regulated Investment Fund (Luxembourg)**

The underlying assets are held inside a **regulated investment fund domiciled in Luxembourg**, one of the strictest jurisdictions in Europe for asset management.

* Not a bank
* Not an informal structure
* A fully regulated investment fund
* Managed by licensed financial professionals
* Independent risk, valuation, and compliance procedures

Documentation:\
➡️ Fund Folder: [*https://drive.google.com/drive/folders/1Xf8om53t6agqqCjSAkgxR9P-9SwADKbF*](https://drive.google.com/drive/folders/1Xf8om53t6agqqCjSAkgxR9P-9SwADKbF)\
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*Don't hesitate to schedule a call to have more info,* [*https://calendly.com/gregoire-ledgity*](https://calendly.com/gregoire-ledgity)

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### **2. Asset Allocation Model**

Ledgity applies a diversified model combining regulated RWA with on-chain liquidity management:

* **80% - 90% — Off-chain regulated RWA**
  * Short-term fixed income
  * Corporate and government debt
  * High-grade receivables
  * Instruments managed inside the Luxembourg fund
  * Full due diligence + monthly NAV valuation
* **5%-15% — On-chain integrations**
  * Blue-chip DeFi money markets (e.g., Aave)
  * Capital-efficient liquidity optimizations
  * Always non-custodial
* **5% — Liquidity Buffer (instant withdrawals)**
  * Immediate liquidity for user redemptions
  * Allocated automatiquement in AAVE pool
  * Fully visible on-chain

This model allows Ledgity to deliver a **stable daily yield (\~9% APY)** with **controlled risk** and full transparency.

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### **3. Custody & Valuation**

#### **Custodian**

The Luxembourg investment fund has its own **regulated custodian** responsible for:

* Safekeeping the assets
* Settlement of financial instruments
* Oversight of cash movements

#### **Valuation Agent**

The fund appoints an **independent valuation entity** responsible for:

* Monthly NAV calculation
* Pricing of assets
* Reporting to auditors and regulator

#### **Auditors**

Yes — the fund is **audited annually** by a certified external auditor.

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### **4. Proof of Reserves (PoR)**

Ledgity is integrating **on-chain Proof of Reserves**, powered by **Chainlink**, to give users cryptographic verification of collateral.

#### **Phase 1 — On-chain Transparency**

* Real-time on-chain view of instant liquidity
* Ledger of Aave buffer positions
* Token supply vs liquid reserves

#### **Phase 2 — Off-chain Fund Proof (via Chainlink PoR)**

The Luxembourg fund publishes:

* Monthly NAV attestation
* Independent valuation documents
* Proof of assets held by the fund
* Automated updates through Chainlink PoR

This allows users to verify:

* Total token supply
* Total eligible collateral
* Excess reserves
* NAV evolution

#### **Future: Secure Mint (soon)**

We integrate a “**secure mint**” approach, ensuring that:

> **It becomes cryptographically impossible to mint more lyUSD/lyEUR than the proven reserves.**

This will fully align minting logic with verified Proof-of-Reserves data.

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Ledgity’s vision is to deliver one of the most transparent stablecoin-yield infrastructures in Europe, aligned with institutional requirements and MICA standards.