swDUSD

Institutional Access to Enhanced Yield — On-Chain and Off-Chain

swDUSD is a non-rebasing ERC-20 token issued exclusively by Delta Institutional, providing institutional and qualified investors with secure, yield-bearing exposure to the Delta ecosystem. swDUSD represents a custodial stake in sDUSD, combining the transparency and composability of on-chain assets with the enhanced performance of institutional-grade off-chain strategies.

Token Structure and Distribution

swDUSD is structured to maintain a 1:1 relationship with the underlying sDUSD holdings managed by Delta Institutional. Unlike rebasing tokens, swDUSD preserves a fixed token quantity, with accrued yield reflected in the token’s redeemable value rather than in balance fluctuations. This design supports broad compatibility across both DeFi and CeFi platforms, and enhances usability in collateralized applications.

Depending on the specific needs and regulatory profile of the client, Delta Institutional offers flexible custody arrangements. In certain cases, Delta Institutional retains swDUSD on behalf of the user under a fully custodial model. Alternatively, upon request and subject to eligibility, clients may receive swDUSD directly to a designated wallet address, enabling independent use in decentralized applications.

Yield Composition and Accrual

swDUSD: Multi-Layered Yield Model

swDUSD accrues rewards derived from the performance of its underlying sDUSD position. The reward mechanism is underpinned by two primary sources:

1

Delta-Neutral Basis Trading

Delta Money employs delta-neutral strategies that capture funding rate inefficiencies across major perpetual futures exchanges. These basis trades are designed to systematically generate yield while minimizing directional market exposure.

2

Institutional Reserve Asset Deployment

Capital is also allocated to a diversified portfolio of low-risk, income-generating assets, including:

• Short-duration sovereign debt instruments

• Collateralized repurchase agreements (repos)

• Stablecoin liquidity provisioning in curated DeFi venues

These two pillars ensure a stable and scalable reward distribution model, specifically engineered to meet the expectations and compliance requirements of institutional investors.

Enhanced Yield via Off-Chain Strategies

In addition to the base yield generated through the sDUSD mechanism, whitelisted swDUSD holders gain access to enhanced returns sourced from discretionary, off-chain strategies managed by Delta Institutional. These strategies include:

• Participation in U.S. and non-U.S. sovereign bond markets, optimizing for yield curve positioning

• Engagement in global repo markets, capturing short-term secured lending returns

• Carry trades in emerging economies, leveraging macroeconomic spreads and currency differentials

All additional rewards are automatically compounded into the underlying sDUSD position, thereby increasing the redeemable value of swDUSD over time. This compound structure supports capital growth without manual intervention, while preserving alignment with the token’s underlying assets.

Institutional Compliance and Oversight

swDUSD: Tokenized Custody Infrastructure

swDUSD is issued solely to pre-qualified, whitelisted entities, in accordance with Delta Institutional’s compliance, KYC/AML, and governance protocols. Exposure is structured through SPVs (Special Purpose Vehicles), providing institutional investors with regulated access to yield-bearing products while maintaining asset segregation and legal clarity.

Delta Institutional oversees risk management, investment execution, and custodial safeguards—offering clients comprehensive reporting, transparency, and operational peace of mind.

Bridging Traditional Capital with Composable Finance

swDUSD represents a unique synthesis of institutional-grade asset management and decentralized composability. It enables clients to harness stable yield, enhanced capital efficiency, and seamless blockchain interoperability — all within a compliant, secure framework.

Whether held under custody or deployed independently, swDUSD serves as a core building block for institutions seeking scalable, risk-adjusted exposure to the evolving digital asset landscape.