Umami is a yield management protocol built on Arbitrum that automates complex hedging strategies on behalf of users to generate sustainable profits.

Yield

Umami

Protocol Code Quality

Protocol Maturity

Protocol Design

Risk Rating

Watch Out

* [Documentation](https://docs.umami.finance/) 
 * Auditors 
 	* [Zokyo](https://www.linkedin.com/posts/zokyo_umami-finance-audit-reportzokyoio-activity-6957342236929896449-LFif/?utm_source=linkedin_share&utm_medium=member_desktop_web) 
 * Please see our [FAQ on experienced auditors](https://help.exponential.fi/en/articles/6381015-what-are-experienced-auditors)

Exploit/Hacks

green

None

* [Website](https://umami.finance/)  
 * Token: UMAMI  
 * Tags: Yield

Info

* TVL: $30.7K (Rank #155)  
 * TVL Ranking by Yield: #19  
 * Blockchain: Arbitrum  
 * Chain TVL  
 	* Arbitrum: $30.73K

Key Metrics

Information


- Code reviewed by at least one experienced auditor; [Zokyo](https://www.linkedin.com/posts/zokyo_umami-finance-audit-reportzokyoio-activity-6957342236929896449-LFif/?utm_source=linkedin_share&utm_medium=member_desktop_web) audited in July 2022
- Anonymous team reduces transparency
- No documented protocol hacks since launch

yellow


- Core protocol launched in 2021; maturity less than 1 year increases technical risk as smart contracts are less battle-tested
- Top 20% by total value locked slightly reduces risk
- Decentralized governance increases transparency
- Low voting power concentration reduces risk

Risk Assessment

Umami provides users broad exposure to the Arbitrum ecosystem through its treasury assets.

What we like

Two-thirds of the core devs are anonymous and the treasury multisig only requires 3/5 signers.

What we like less

Offers you a great way to earn "real yield" through strong tokenomics and passive income paid in ETH.

What it means for you

Summary

#### How Umami works
Umami is an Arbitrum-native protocol that is building a variety of highly-scalable vault strategies. These vaults strive to generate sustainable yield on core crypto assets like USDC, ETH and BTC. Umami plans to onboard institutional capital through its subsidiary, Umami Advisors. a U.S.-compliant legal entity. Umami utilizes its treasury assets to enter into yield-generating opportunities across DeFi on Arbitrum. The protocol designed its tokenomics such that 50% of the yield earned is distributed to UMAMI token holders who stake or locked. The other 50% is distributed back into the treasury and used for future yield opportunities. All yield distributed to stakers are paid in ETH, which is a preferred alternative to distributing rewards in its native UMAMI token as this reduces the token's dilution over time. UMAMI has a fixed supply of 1M tokens and no emissions. This makes the token more desirable as the protocol's treasury grows and UMAMI token holder's claims on treasury earnings become more desirable. Umami plans to release its own vault strategies in the future to generate risk-adjusted yield on crypto assets like ETH and BTC. These vaults will likely leverage its ecosystem partners like GMX and Tracer to generate yield. The protocol will take a deposit fee, management fee and performance fee in return, which ultimately gets redistributed back to the protocol treasury and UMAMI stakers.
#### How Umami makes money
The protocol leverages its own treasury to generate yield across DeFi on Arbitrum. Umami passes on 50% of its treasury earnings every month to  its stakers (mUMAMI). The remaining revenue is redistributed back to its treasury and used for future yield opportunities.
#### How you make money on Umami
You can stake UMAMI (mUMAMI) on the platform to earn 50% of all treasury earnings every month. You can also leverage the mUMAMI autocompounder to automatically convert ETH rewards earned to market buy UMAMI and redeposit into the protocol to compound earnings over time.