Flynt Finance is a crypto platform that pays high interest by utilizing trading strategies to earn yield. Each week, users subscribe to individual strategies and on Wednesday and Friday the results and returns are made.
We had the opportunity to talk with the team at Flynt Finance, to help better understand the platform, understand the strategies and safeguards in place, and what the team is working towards in the future. We hope you’ll find this Q&A informative.
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For beginners in the crypto interest space, can you provide a simple explanation of how Flynt Finance allows users to earn yield on their BTC, ETH, and USDC holdings?
At Flynt, transparency is a core value that drives us to fully disclose all the sources of returns and funds. This is especially crucial on our platform, where clients need to have a clear understanding of the strategies used to generate these returns. In short, we create real yield through a combination of options, futures, spot trading, staking, and liquidity provision. To ensure a seamless experience for our clients, we handle all the complex research and trading operations in the background, allowing our clients to simply deposit and subscribe.
Are there any minimum or maximum deposit limits for users on the Flynt Finance platform?
There is a minimum amount required to subscribe into our strategies.
- BTC Covered Calls x5 : 0.001 BTC
- ETH Covered Calls x3 : 0.01 ETH
- USDC GMX:GLP : 500 USDC
What tools or features are available for users to track and manage their crypto interest income?
We’ve recently updated our portfolio page to provide clients with a clear overview of their assets. On this page, clients can easily check their returns, asset value, and portfolio allocation.
Our clients can also use our mobile app currently available on Google Play Store!
In addition to the portfolio page, we also send out weekly strategy results via email and app notifications to keep our clients up-to-date on their fund’s performance. This regular communication ensures that our clients are well-informed about their investments.
Can you elaborate on the covered call strategies employed by Flynt Finance to help maximize yields for your users, and how these strategies differentiate from other yield-generating mechanisms?
There are various strategies in which yield can be generated. However, selling covered calls is often referred to as “the original yield farming” as it has been greatly loved in the TradFi space. A covered call is a financial strategy that involves owning a cryptocurrency asset, and then selling the right to buy that asset (called a “call option”) to someone else. The buyer of the call option pays a fee (called a “premium”) for the right to buy the asset from the owner at a specific price, known as the “strike price,” before a certain date, known as the “expiration date.”
Flynt Finance’s covered call strategy involves selling call options on Bitcoin and Ethereum with leverage of 5x and 3x, respectively. While leverage is used, it does not necessarily mean higher risk as the risk levels can be managed through the selection of the strike price (i.e., setting a strike price much higher than the current spot market price). If the price of the asset is above the strike price at expiry, then the strategy makes a loss. However, so far both strategies have experienced only one loss week each over the span of the last 8 months.
One way in which Flynt Finance’s call option selling strategy differentiates from other yield-generating mechanisms is that it provides users with potentially higher yields. By selling call options, users can earn a premium in addition to any price appreciation of the underlying asset. This potentially allows users to earn higher yields than other yield-generating mechanisms, such as staking or liquidity provision.
Another key difference is that Flynt Finance’s call option selling strategy is flexible. This means that depending on the market conditions, the strategies can be modified or exited early to minimize any potential losses.
The biggest advantage of Flynt’s options strategy is that it is extremely transparent, providing users with all the necessary data about the strategy without overwhelming them with a large amount of information or showing none at all. Transparency is key to understanding where the yield comes from.
It is important to note that Flynt’s call option selling strategy involves a higher level of risk than other yield-generating mechanisms. If the price of the underlying asset rises above the strike price of the call option, the buyer of the option may exercise their option, resulting in potential loss for the user. However, Flynt has conducted in-depth analysis and backtests to mitigate risk by adjusting the strike price and time of position entry based on market conditions.
Overall, Flynt’s call option selling strategy provides a unique approach to generating yield that is potentially more profitable and transparent compared to other yield-generating mechanisms. However, users should carefully consider their risk tolerance before investing in this strategy.
Users with a lower risk tolerance level are welcome to join the USDC delta-neutral strategy as it aims to generate returns without being exposed to price volatility.
With CeFi, trust is a large and valid concern. How does Flynt Finance consider this trust into operating and running the platform?
We launched Flynt in September 2022 after seeing the lack of transparency in centralized platforms. Our team wanted to address these issues by providing a more transparent platform for users. Since then, we’ve been constantly asking ourselves, “How can we be even more transparent?” and “How can we better inform our users about the risks involved in our strategies?”
As long as we don’t become a DeFi project, the “not your keys, not your crypto” concerns will remain. However, at Flynt, we strive to show exactly where our users’ funds are located and how they’re being used. For DeFi engagements, we’ve opened our wallet address for anyone to check the funds. For CeFi engagements, we provide proof of funds each week along with deposit addresses of the engaged exchanges. We’re continuously exploring new ways to showcase the movement of assets while keeping the security of our users’ assets a top priority.
How does Flynt Finance deal with periods of high market volatility?
At Flynt, we closely monitor market movements and take immediate action, regardless of whether the market is highly volatile or not. However, our strategies tend to generate higher returns during times of high market volatility, as a certain degree of price change is beneficial to our approach.
Our USDC GMX:GLP strategy is optimized for highly volatile market conditions, as it aims to earn yield from trading fees on the GMX exchange while mitigating the price exposure of the GLP basket. However, we don’t want volatility for USDC itself, but rest assured as we constantly monitor the market to ensure prompt action when needed.
When USDC was recently de-pegged, for instance, we swiftly converted our assets into USDT within just 10-15 minutes, effectively securing our asset value. This is a testament to our commitment to safeguarding our clients’ investments and delivering optimal returns even in times of market instability.
Meanwhile, the covered call strategy has its advantages and disadvantages during a volatile market. On the one hand, option premiums tend to increase during times of higher market uncertainty, potentially leading to higher income for the seller of the call option (which is the covered call strategy). However, as the market shows upward volatility, the strategy itself is exposed to potential loss. In a recent scenario where Bitcoin’s price surged from $20,000 to $28,000 within 3-5 days, the Flynt team decided to close out the covered call position early as we expected a stronger upward movement, reducing our users’ losses by 80%.
What are the key factors you consider in your risk assessment process to ensure the safety and security of users’ funds on your platform?
In regards to asset security, we can break it down into 3 layers of control which are Flynt platform, asset custody and counter-party trading platforms.
- Flynt Platform
- Our platform has multiple security measures put in place to ensure any interactions of funds coming in or going out are actions made by our users. Each transaction is screened with Chainalysis to ensure funds were not and will not be used for any illicit activities. We have also implemented Multi-Factor Authorization and wallet whitelisting to ensure withdrawals requested by users are all verified and authorized by our clients. All withdrawals are also processed manually to ensure legitimacy.
- Asset Custody
- We partner with industry leading digital asset custody partners including Fireblocks, Ceffu (previously known as Binance Custody) and BitGo to be able to provide institutional-grade security on our clients’ assets.
- Counter-party Trading Platforms
- We are very selective on which exchanges and decentralized finance platforms we trade on. At the moment, we currently trade on Deribit for options and Binance for futures or perpetuals. We also interact with GMX which has demonstrated strong platform stability over the past year.
What details or info can you provide on the latest yield-generating strategies, and how they’ve differed from the strategies used in the past?
Our strategies were already quite different from our competitors’ products in two ways largely;
- We use leverage, so our returns are always higher than our competitors (of course this also means we take on more risk though)
- Our strike price (the price you don’t want to surpass) selection algorithm isn’t a simple delta based algorithm. As our execution algorithm is different, we have a much lower loss ratio. Since we’ve launched our BTC product last Sept. we had 1 loss week, whereas our competitor has had three.
(remember each loss has large draw downs for option selling strategies)
Are there any changing terms for the updated strategy you will be launching for the Bitcoin and Ethereum covered call strategies? (e.g. fees, dates, assets, etc)
Our newest upgrade started with trying to reduce risk even further.
The most dangerous aspect of an option selling strategy is when there is a short squeeze(sharp rise in price due to market makers covering their shorts and market participants chasing). This was a common phenomenon during the 2020 early bull run.
We looked into numerous data points and indicators to come up with the ‘UpMaybe Signal’. This signal aims to predict the potential for a short squeeze. As with all signals, there are no perfect signals, hence the name UpMaybe.
Applying the ‘UpMaybe Signal’ on our backtests improved our strategy drastically by side stepping some of the large loss situations.
By not entering a covered call position when the signal comes on increased the annualized returns for our BTC Covered Call x5 strategy from 32% to 54.5% and reduced the max draw down from -60% to -16%.
After confirming the signal’s effectiveness, we decided to take it one step further by buying long options instead of simply not entering a trade. To our surprise, it improved our performance to 97% per annum with the same max draw down of -16%. In one particular year, the strategy increased the number of bitcoins by 320%. That’s a 4.2x in the number of bitcoins in a year.🤯
This led to the birth of our new strategy the ‘BTC Covered Call X’.
This strategy should be live in about two weeks.
The fees are 30% on profitable weeks only and there are no other managerial fees.
You will also be able to withdraw on a weekly basis unlike other services that lock you in for months!
More information on the strategy can be found here.
Can you discuss the role of community feedback in shaping the roadmap and feature set of Flynt Finance, and how you prioritize user requests for improvements or additions to the platform?
We place great importance on feedback from our community. We are constantly looking for ways to gather more comments and suggestions from our users, as we value their input in helping us improve our services.
As a small team, we operate in sprints and have a long backlog of features and strategies that we want to implement. However, we understand the importance of prioritizing tasks based on our users’ needs and community feedback plays a significant role in our decision-making process. We have successfully delivered several features that our users have requested, including 2FA and real-time trade updates. Now, we have also released an improved strategy that our clients have been eagerly awaiting.
So if you have any feedback, don’t hesitate to reach us on Discord or leave your remarks on TrustPilot.
How do you plan to stay competitive and innovative in the crypto interest space and/or what sets Flynt Finance apart from its competitors?
Our platform’s unique selling point is our commitment to transparency and high yields. We believe that we are the only platform in the industry that can generate non-ponzi, real yields with complete transparency. Our weekly lockups offer our clients the flexibility to analyze the market and decide whether or not to join a strategy for that week.
Innovation is at the heart of what we do. Our research team is constantly working day and night to develop a back testing framework that allows us to test new strategies quickly and easily. We were among the first platforms to offer the GMX GLP delta-neutral vault and successfully generate yield through on-time trades. We are currently exploring various DeFi platforms to contribute to the ecosystem and earn sustainable real yields for our clients.
Thanks to Flynt Finance for answering our questions!
That wraps up our Q&A with Flynt Finance. It’s clear to see the team is pushing on creating a world-class service that allows you to benefit from powerful investment strategies, with significant safe guards in place. However, leveraging these strategies can create negative returns, if you look only at a weekly time frame. Our recommendation is for those users comfortable with risk, a medium to long-term investment horizon and Flynt being a part of a well-diversified selection of custodial and non-custodial services.
View Flynt Finance Interest Rates & Review
Note: this article is not financial advice, nor are we financial advisors. Depositing funds into any crypto platform to carries risks.