Fund Mechanics

CypherFund is a fully autonomous, on-chain investment framework governed by smart-contract logic and powered by a quantitative AI engine. Its structure is designed to align incentives, enforce discipline, and deliver full transparency across all capital flows and performance parameters.

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↝ Fund Structure

CypherFund operates on a non-custodial, trustless architecture, where all parameters governing capital are embedded directly in immutable smart contracts.

Core Fund Rules:

• 365-day lock period applied to each deposit

• 2% management fee, distributed continuously on-chain

• 20% performance fee, applied only when returns exceed an 8% annual hurdle rate

All calculations, fee logic, and performance thresholds are executed programmatically at the contract level — ensuring fairness, clarity, and verifiability.

CypherFund allocates capital natively within the BNB ecosystem, allowing its AI models to specialize in ecosystem-specific liquidity structures, volatility patterns, and narrative flows, ensuring sharper and more data-driven execution.

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↝ Dynamic Portfolio Management

CypherFund’s AI continuously monitors market conditions, volatility regimes, sentiment signals, and liquidity flows to optimize exposure in real time.

The allocation engine relies on a composite scoring framework, which evaluates each asset based on:

• Sharpe-adjusted return expectation

• Sentiment-derived weighting

• Liquidity depth and stability

• Correlation and systemic risk factors

Rather than relying on static allocation rules, CypherFund applies a regime-adaptive, non-linear rebalancing model that evolves dynamically with changing conditions.

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↝ Real-Time Rebalancing

Rebalancing is fully autonomous and event-driven. Adjustments occur when any of the following conditions are met:

• Deviation from optimal portfolio weights

• Emergence of a new high-confidence signal

• Market regime transition or volatility shock

• Scheduled algorithmic update cycles

Once triggered, CypherFund prepares and executes on-chain rebalancing transactions through decentralized infrastructure, ensuring:

✅ Rapid execution ✅ Gas-efficient routing ✅ Transparent, auditable operations

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↝ Deposit Pool Logic

Depositors contribute to a smart contract-managed capital pool, receiving tokenized shares representing their pro-rata claim on the fund’s Net Asset Value (NAV).

Capital within the pool is autonomously deployed to:

• Select risk-efficient opportunities

• Allocate and rotate liquidity

• Hedge systemic or asset-specific risks

• Maximize idle capital efficiency

The system remains fully non-custodial — funds are never held or controlled by any team member. Withdrawals are available after the 365-day lock, calculated in real time against the fund’s NAV, ensuring fair and accurate redemptions.

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↝ Expected Performance & Scenarios

CypherFund does not guarantee fixed returns. Its objective is to outperform passive benchmarks over full market cycles by:

• Capturing alpha from short- and mid-term opportunities

• Reducing drawdowns via adaptive risk controls

• Exploiting BNB-specific inefficiencies

• Maintaining discipline during volatility

Internal backtests indicate meaningful outperformance compared to passive strategies, with lower volatility and stronger downside protection. However, as with all DeFi systems, risks remain — including smart contract vulnerabilities, liquidity crises, and broader market stress events.