BTS Factory

The BTS Factory serves as the core infrastructure enabling widespread adoption of ERC-BTS token technology. Users utilize the factory to design and deploy new tokenized funds on the blockchain. Secondary users can also employ the BTS Factory to create and redeem BTS LP tokens in existing BTS funds.

To mint a new ERC-BTS, users connect a compatible web3 wallet (Metamask or Trust Wallet) and add token contracts for desired underlying assets. ALVA is automatically included in each fund at a minimum weighting of 5%, with the remaining 95% customizable by the fund manager. Cross-chain fund creation is supported by adding tokens from any compatible blockchain.

Once tokens with a combined weighting of 100% are added, the ERC-BTS is ready to be minted. Successful minting requires a minimum amount of 1 ETH (or equivalent). This minimum contribution aims to prevent excessive ERC-BTS creation. The creator can personalize their ERC-BTS with any artwork without displaying underlying token logos or names.

Upon minting, the ERC-BTS is held by the fund creator, granting access to both management rights and fees. The creator also possesses BTS LP tokens representing their minimum 1 ETH capital investment. These tokens are tradable on HiveX and redeemable at NAV value via the ERC-BTS Factory.

While the ERC-BTS token is held by the fund creator, the underlying assets remain non-custodial. The creator only has access to personally contributed assets (1 ETH minimum at deployment + any later contributions) represented by the BTS LP tokens they hold.

Alvara streamlines the integration of DeFi lending protocols (e.g., Compound, Aave, dYdX) for fund managers, enabling them to lend ERC-BTSs' underlying assets and generate interest revenue, compounded either every block or immediately after fee payments. This interest income is automatically reinvested. All yielded assets can be leveraged for revenue, with earnings distributed monthly to BTS LP holders or reinvested in the fund to boost each LP token's Net Asset Value (NAV). The decision to distribute or reinvest yield lies with the fund manager or the fund's DAO, determined by the governance structure.

When creating an ERC-BTS, the fund initiator can choose to utilize lending protocols for additional yield. As the fund expands, the DAO decides on the initiation, continuation, or cessation of lending practices and whether BTS token holders can claim earned interest or if it contributes to NAV growth. Each fund's APY is transparently displayed under the fund information and on the leaderboard.

ERC-BTS managers and DAO members should assess the liquidity of underlying assets when proposing yield-generating activities. Alvara provides educational resources for decision-making, considering liquidity requirements for yield generation proposals.

By default, received underlying assets should be held without engaging in staking, lending, or yield enhancement unless token value and liquidity are secured. When yield opportunities arise, provided the token's value is safeguarded, liquidity is assured, and potential risks are mitigated through insurance or collateral, ERC-BTS managers can seize such opportunities.