Teahouse Midsummer Dream

Risk Category: High; Crowdfunded blue chip NFT strategy

Vault Information

DeBank wallet used to purchase the NFTs

Oolong Token contract address: 0xCE242415649c20729403b5B8ce2639660976b40e 1 Oolong Token = 0.01 ETH

Total fund size: 100 ETH (10,000 Oolong)

Liquidation Threshold: +/- 50% (in ETH)

Voting Period: 6/14 15:00 – 6/18 15:00 UTC+8

Deposit Period: 6/23 15:00 – 6/27 15:00 UTC+8

Crowdfunding Process

STEP 1: Crowdfund up to 100 ETH on the Teahouse platform. Each 0.01 ETH will be exchanged for 1 Oolong Token issued by Teahouse as proof of investment.

STEP 2: Teahouse will use the ETH crowdfunded in STEP 1 to purchase NFTs on Opensea. The exact NFT collection will be decided by the Teahouse HighTable holders through voting. The Teahouse HighTable holders community has decided that we will purchase CloneX and MAYC.

STEP 3: Teahouse will stake the NFTs bought in STEP 2 on the BendDAO platform (or on a similar P2P lending platform) to borrow ETH to re-stake on the chosen platform. Any airdrops and rewards from holding the NFTs or from staking on the chosen platform will be sold into ETH immediately upon drop and staked back into the chosen platform.

STEP 4: If PnL reaches +/-50% (calculated in ETH), the fund will be liquidated, and the PnL will be distributed based on the ratio of Oolong Tokens held by each crowdfunder.

Strategy Details

Teahouse Midsummer Dream Strategy

Blue chip NFTs have the greatest growth potential, especially in this bearish market. However, as these tend to be higher in value, they are more difficult for the common investor to hold. To mitigate this and also take advantage of P2P lending platforms like BendDAO, Teahouse developed this experimental crowdfunding strategy to benefit our HighTable holders. We plan to purchase and stake blue chip NFTs into BendDAO or a similar platform to capitalize on the NFTs' value growth while obtaining any airdrops (from holding the NFTs) and platform rewards (from staking the ETH borrowed from staking the NFTs). This strategy falls into our “high-risk” category.

Fund Stages

STAGE 1: 72 hours of voting on the NFT collections to purchase. (6/14 15:00 – 6/18 15:00 UTC+8)

STAGE 2: 72 hours to exchange ETH for Oolong Tokens. (6/23 15:00 – 6/27 15:00 UTC+8)

STAGE 3: fund runs indefinitely until it reaches +/- 50% PnL (in ETH)

STAGE 4: fund liquidation and PnL distribution (crowdfunders exchange Oolong Tokens back to ETH).

Fees

Teahouse will assess Platform Fees and Management Fees for the Teahouse Midsummer Dream strategy:

Platform Fees: 0.1% to enter, 0.2% to exit. e.g. I initially invest 1 ETH, and at liquidation, I have 1.5 ETH. I will have paid 1 * 0.1% = 0.001 ETH at entry and 1.5 * 0.2% = 0.003 ETH at exit, for a total platform fee of 0.004 ETH.

Management Fees: 1.7% APY for Teahouse using exit value. e.g. I invest 1 ETH, and 1 day later, NFT value increases to 150% of the original, triggering a liquidation. I will incur 1.7% * 1.5 ETH * 1/360 = 0.00007 ETH. Alternatively, if it takes a full year to reach 150%, then I will incur 1.7% * 1.5 ETH = 0.0255 ETH.

The Teahouse Guarantee

The Teahouse Midsummer Dream strategy is an experimental strategy, and the crowdfunders will bear the market risks. However, Teahouse commits to covering the smart contract risks of up to 100 ETH in case of malicious attacks or rug-pulls (for example, by the P2P lending platform Teahouse selected).

FAQs

NFTs

How can I vote on which NFTs to purchase?

During the voting period (6/14 15:00 – 6/18 15:00 UTC+8), Teahouse HighTable holders will get one vote for each HighTable NFT. We will be using Snapshot to facilitate voting and verification.

How will the fund be used to purchase blue chip NFTs?

Based on voting results, we will select the top 2 winners and purchase them at floor prices according to the ratio of the votes.

For example, if the first place winner (A) receives 5566 votes, and the second place winner (B) receives 4433 votes, then 55.66% of the funding pool will be used to purchase A, rounded down, and 44.33% of the fund will be used to purchase B, rounded down.

Any leftover funds will be combined and used to purchase A then B in that order, if possible.

For example, if our pool is 100 ETH, and A receives 5566 votes, then 55.66 ETH will be used to purchase A, rounded down. Assume that A costs 12 ETH each, the # of A purchased would be 4, with 55.66 - 48, or 7.66 ETH left over. Assume that B costs 9 ETH, the # of B purchased would also be 4, with 44.33 - 36 = 8.33 ETH left over. We will combine 7.66 and 8.33 for a total of 15.99 leftover funding, and purchase another A at 12 ETH, with 3.99 ETH leftover.

FUND

What is the fund size?

The Teahouse Midsummer Dream strategy is an experimental project to explore the teaDAO community potential. We will execute the strategy if our fund reaches 50 ETH, and cap the fund at 100 ETH. If the crowdfunded amount is below 50 ETH, earlier investors will have their ETH refunded.

At the beginning of the fund, Oolong tokens will be issued based on an exchange rate of 0.01 ETH = 1 Oolong Token.

How can I enter this fund?

During the Deposit Period (6/23 15:00 – 6/27 15:00 UTC+8), Teahouse HighTable NFT (VIP & OG) holders can exchange ETH for Oolong Tokens. If you are a holder who has already missed the Deposit Period, currently there is no way to enter mid-fund. Please wait for our next fund/strategy.

What is an Oolong Token?

Oolong Tokens are ERC-4626 tokens, minted as a proof of investment. Oolong Tokens will be used to calculate the shares of the fund's pool upon liquidation.

What happens after the NFT purchase?

We will stake the NFTs purchased into BendDAO or a similar platform to borrow more ETH. We will stake this ETH borrowed and the leftover ETH from the previous stage into BendDAO for additional rewards. If we receive any airdrops from holding these NFTs or from the P2P lending platform, we will sell them immediately, and stake the profits into the P2P lending platform.

LIQUIDATION

When can I get my ETH back?

Fund will run indefinitely until it reaches plus or minus 50%, calculated in ETH, upon which it will enter Liquidation Stage. Funds can only be withdrawn (exchanged back to ETH) during the Liquidation Stage.

What happens if the fund gets liquidated from increase in NFT value (+50%)?

If the total value of all NFTs purchased reaches a combined gain of 50% (across both A and B collections), in terms of ETH (e.g. from 100 ETH to 150 ETH, regardless of ETH-fiat prices), Teahouse will sell all NFTs back on Opensea at the current floor prices. After receiving the corresponding ETH, crowdfunders will be notified to exit by exchanging their Oolong Tokens back into ETH.

What happens if the fund gets liquidated from loss in NFT value (-50%)?

If the total value of all NFTs purchased reaches a combined loss of 50% (across both A and B collections), in terms of ETH (e.g. from 100 ETH to 50 ETH, regardless of ETH-fiat prices) Teahouse will sell all NFTs back on Opensea at the current floor prices. After receiving the corresponding ETH, crowdfunders will be notified to exit by exchanging their Oolong Tokens back into ETH.

What happens if I've lost or sold my Oolong Tokens?

Distribution is based on the number of Oolong Tokens in one's wallet. Unfortunately, if a holder has lost or sold their Oolong Tokens, they will be unable to redeem them back for ETH during the Liquidation Stage.