According to a report published recently by CNBC, many people come to cryptocurrency because they find the volatility exciting. The stock markets may offer the opportunity for steady long-term returns, but there’s little thrill in watching incremental growth. Crypto’s wild swings mean that there’s a chance of serious gains, and FOMO also plays a part in attracting people to add digital assets to their portfolio.
However, the reality is that the best way to make money from any asset is with some degree of consistency. But in the highly volatile world of cryptocurrency, achieving consistency can be a full-time job, as you need to be continually watching the markets and readjusting your portfolio accordingly.
The fact is that this simply isn’t possible for most people and an unattractive prospect for anyone who is just hoping to make a bit of passive income from their investments.
Therefore, innovators in the cryptocurrency sector have now started to develop solutions that make it easy for people to invest in crypto without necessarily having to take an always-on approach to managing their funds. Rocket Vault Finance is one such solution – an intelligent, automated fund management tool powered by artificial intelligence and machine learning.
In this guide, we’ll dive into Rocket Vault Finance and how it works.
What is Rocket Vault Finance?
Rocket Vault Finance is a project that allows users to deposit their crypto funds into automated smart vaults. The vaults apply advanced data modeling and statistical analysis to make predictions about risk and rewards. It will then automatically manage funds to ensure maximum gains and minimized losses. The Rocket Vault algorithms work continually, 24/7 every day with no human intervention, offering a completely passive fund management solution.
At the time of writing, Rocket Vault Finance has been in continuous testing since January 2020 and has consistently produced over 100% APY.
The system monitors over 700 assets listed in various exchanges across the globe. The algorithms are programmed to observe patterns that will identify those tokens showing upside potential and avoiding tokens that show signs of risk. The vaults will ensure a diverse portfolio as another risk management tool and ensure that profits are taken at the most optimal levels based on historical data.
Part of the reason that the Rocket Vaults produce such high yields is compounding, whereby a percentage of gains are automatically reinvested back into the portfolio, so they themselves start earning profits. Rewards are distributed quarterly in stablecoins – USDC, USDT, or DAI, depending on the user’s choice.
A user is required to leave their funds invested in the vault until the end of the quarterly payout period to be eligible for their payment in that quarter.
How it works
Rocket Vault Finance uses some fairly advanced technology comprising a series of engines handling data fetching from exchanges, predictions, and asset rebalancing.
The data fetching engine pulls data in real time from multiple exchanges using APIs. It’s then fed into the prediction engine, which applies artificial intelligence and machine learning capabilities to the incoming and historical price data. The algorithms look for patterns that feed decisions regarding when to buy and sell to lock in the most gains.
The asset rebalancing feature comprises a Treasury Management engine and a monitoring engine. Effectively, user funds in Rocket Vaults are managed in pools, and the Treasury acts as a reserve to ensure that user demands for withdrawal can be met at any given moment in time. The Treasury Management engine handles the investments, reserves, and take profit functions. It also feeds a blockchain-based smart contract for quarterly rewards distribution to users.
The prediction engine also contains a monitoring feature that will continually scan the markets to ensure that orders are always being executed according to current conditions. A fixed percentage of profits are taken and converted to stablecoins, while the rest is reinvested for compounded returns.
During testing, the Rocket Vault smart vaults have achieved a 75% success rate in predicting the direction of movement for any given asset.
The RVF token is an ERC-20 utility token that has been minted in a fixed supply. Rocket Vault is operating an innovative token sale mechanism designed to lock up tokens in a bid to help drive the token price. Investors are required to make a minimum contribution of two ETH to participate. However, they can receive 50% of their initial investment refunded over time.
The pre-sale has already taken place in early January. Investors will receive payouts on February 1, March 1, and April 1, and afterwards, each quarter until the threshold of 50% of their investment is reached. Along with the minimum two ETH investment, they must also hold 50 RVF tokens to be eligible to receive their refund, ensuring that a share of RVF remains locked away until the end of the refund period.
The RVF token offers fee reduction benefits on Rocket Vault’s services for retail investors, who can access the vaults for free by holding a fixed number of RVF tokens. As the vaults generate gains, the user is charged a fixed percentage of the profits as a fee. If the user chooses to unstake their RVF while still leaving deposits in the vaults, they are charged an additional 5% fee on their gains.
Institutional investors have a slightly different subscription model, as they agree to pay a fixed fee of 2% of the deposit value and a fee of 5% on profits.
About the founder
Kiran Mannam is the founder and CEO of Rocket Vault. He has over 17 years of experience as a senior banking consultant working at SAP within their financial services division, helping global banking clients solve their system problems.
Despite working for a global corporation, Kiran has shown a flair for entrepreneurship over the years. During his time in SAP, he worked on a fintech startup aimed at helping corporate banking clients simplify their cross-border connections with payment service providers. The startup was ranked among the top seven business ideas within SAP in 2018. Kiran has been working on Rocket Vault Finance since 2019.
As the crypto space matures and diversifies, it’s more difficult than ever to implement passive investment strategies with guaranteed returns. Buying and holding simply means watching the value of your portfolio go up and down with market volatility but knowing when to exit a position and take profit is the art of trading, not passive investing.
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Therefore, Rocket Vaults could provide an attractive opportunity for newcomers and even more experienced investors to generate passive gains from their portfolio. For institutions, it takes much of the effort out of fund management.
Rocket Vaults also appear to offer some impressive results of over 100% APY. However, it’s important to remember that the project cannot guarantee these returns over time, and all crypto investing comes with a degree of risk. As with every investment, make sure you do your own research and never risk more than you can afford to lose.