Strike Finance Liquidity Deployment
On-chain changes
- 9,000,000 ₳paid tostake1u8v...5c98w6yj
Abstract
Strike Finance V2 Treasury Deployment Proposal
This governance action requests a 12-month productive treasury deployment of 9,000,000 ADA into Strike Finance V2 liquidity infrastructure.
This is not grant funding. Treasury-owned capital would be deployed to deepen Cardano-native perpetual futures liquidity, increase on-chain trading activity, and generate yield for the Cardano Treasury.
Strike has processed over 1,130,000,000 USD in cumulative volume, facilitated 968,000+ trades across 3,071 unique traders, generated over 3,250,000 USD in profit for liquidity providers, produced over 1,160,000 USD in total protocol revenue, and represented over 50% of Cardano trading activity during the past six months.
| Allocation | Amount | Purpose |
|---|---|---|
| V2 USDM liquidity | 9,000,000 ADA sold for USDM | Support scalable execution depth and stablecoin markets |
The deployed ADA will be sold for USDM, Cardano's fiat-backed stablecoin, to provide stablecoin-denominated liquidity. For modeling, this proposal assumes ADA = 0.15 USD, making 9,000,000 ADA approximately 1,350,000 USDM of stablecoin liquidity. The actual USDM notional will depend on the conversion price at deployment and will be transparently reported.
Under conservative modeled assumptions, the deployment is expected to generate approximately 900,000 ADA-equivalent in annual yield. Assuming no ADA price change, this would increase the treasury-owned position from 9,000,000 ADA to approximately 9,900,000 ADA-equivalent over 12 months. These are modeled estimates, not guaranteed returns.
A council composed of Rami from Snek, Phil from Surf, and James from Moneta will serve as the administrator for this proposal. Operational custody of deployed liquidity will be handled through this independent multisig council. Strike Finance will not have unilateral custody or control of treasury assets.
Realized yield from the first six months will be returned to the Cardano Treasury at month 6. At month 12, 100% of treasury-owned deployed assets, including remaining principal and realized yield, will be returned to the Cardano Treasury. Any further treasury participation would require a new governance proposal.
Motivation & rationale
Strike Finance Liquidity Growth Context
Perpetual futures markets represent one of the largest categories of global digital asset trading activity. More than 75% of cryptocurrency trading activity now occurs through perpetual futures markets.
If Cardano intends to compete as a globally relevant financial ecosystem, it needs derivatives infrastructure capable of supporting meaningful liquidity, strong execution, and sustained trader participation.
Today, a meaningful portion of derivatives trading demand from Cardano users leaves the Cardano ecosystem for centralized exchanges and competing blockchain ecosystems. This causes liquidity, fees, trader attention, and financial activity to move outside Cardano.
Strike Finance addresses this by providing Cardano-native perpetual futures infrastructure.
Demonstrated Demand
The demand has already been demonstrated. Strike has:
- Processed more than 1,148,000,000 USD in cumulative trading volume
- Facilitated more than 1,001,000 trades across 3,226 unique traders
- Generated more than 3,250,000 USD in profit for liquidity providers
- Produced more than 1,167,000 USD in total protocol revenue
- Accounted for more than 50% of Cardano trading activity over the past six months
The primary bottleneck to further growth is liquidity depth.
V2 Liquidity and Trading Activity
V2 data since launch shows the relationship between stablecoin liquidity and Strike trading activity. From V2 launch on 2026-03-20 through 2026-06-15, the protocol produced:
| V2 metric since launch | Public data |
|---|---|
| Total V2 volume | 87,288,044 USD |
| 30-day V2 volume | 75,322,500 USD |
| 7-day V2 volume | 29,220,000 USD |
| Total V2 trades | 410,800 |
| 30-day V2 trades | 241,400 |
| Total V2 users | 2,681 |
| Peak daily active users | 875 |
| Total V2 revenue | 30,105 USD |
| Peak open interest | 1,246,007 USD on 2026-06-15 |
Monthly platform growth shows clear acceleration across volume, revenue, and trades as liquidity deepened:
| Month | V2 volume | V2 revenue | V2 trades | Vault TVL at month start |
|---|---|---|---|---|
| March 2026, from 03-20 launch | 1,558,000 USD | 2,083 USD | 11,961 | Vault not yet launched |
| April 2026 | 7,662,000 USD | 4,249 USD | 55,238 | 147,208 USD, Apr 5 launch |
| May 2026 | 26,147,000 USD | 8,917 USD | 206,392 | 711,143 USD |
| June 2026, first 15 days | 51,199,211 USD | 10,000 USD | 137,211 | 992,232 USD |
The first fifteen days of June alone exceeded the entire month of May in both volume and revenue, putting V2 on a run rate of over 100,000,000 USD in monthly volume. Protocol revenue has grown every month since launch -- 2,083 USD in March, 4,249 USD in April, 8,917 USD in May, and 10,000 USD in just the first fifteen days of June -- tracking the growth in liquidity and volume directly.
Strike Liquidity Provider Vault
The Strike Liquidity Provider vault supporting V2 market making is live with two months of public performance history.
| Strike Liquidity Provider metric | Latest reported value |
|---|---|
| Current total value locked | 985,271.59 USD |
| Annual percentage rate | 43.52% |
| All-time period return | +8.85% |
| All-time profit and loss | +69,537.24 USD |
| Realized profit and loss | +46,678.24 USD |
| Maximum drawdown | 1.15% |
| All-time Sharpe ratio | 4.97 |
| Vault all-time volume | 39,881,464.76 USD |
| Depositors | 208 |
| Leader commission / fee | 0% |
| Minimum owner share | 5.00% |
| Lockup period | 1 day |
| Vault age | 2 months |
| Owner | 019d06...a144 |
| Description | Official liquidity vault powered by advanced market-making strategies |
The vault's own history demonstrates the liquidity-to-volume flywheel directly. Vault total value locked grew from approximately 147,000 USD in early April to approximately 985,000 USD in the latest reported snapshot, and over that same period monthly V2 volume grew from 7,700,000 USD in April to 26,100,000 USD in May and 51,200,000 USD in just the first fifteen days of June.
Despite the vault growing more than sixfold, the annual percentage rate has increased to 43.52%, profit and loss is trending upward, and the vault maintains an all-time Sharpe ratio of 4.97 with a maximum drawdown of only 1.15%.
These figures do not prove that liquidity alone guarantees future volume or yield. They show that Strike V2 already has a measurable stablecoin liquidity flywheel: as available stablecoin liquidity increased, the protocol supported higher trading activity, fee generation, and a live vault with public performance history -- and yield did not compress as capital scaled.
Liquidity Flywheel
Greater liquidity supports tighter spreads, deeper execution, larger position capacity, better trader retention, more on-chain trading activity, more fee generation for liquidity providers, and stronger Cardano-native decentralized finance infrastructure.
This creates a direct ecosystem flywheel:
More liquidity -> better execution -> more traders -> more volume -> more yield -> stronger Cardano decentralized finance
This proposal gives the Cardano Treasury a way to become more productive. Instead of leaving a portion of treasury assets idle, treasury capital can be deployed into transparent Cardano-native liquidity infrastructure with the objective of earning yield for the ecosystem.
In compliance with Section 7 "Treasury Withdrawals" of the Cardano Constitution Action Standards, any ADA received from the treasury withdrawal that is held by the administrator prior to deployment will be kept in one or more separate accounts that can be audited by the Cardano Community. Such accounts will not be delegated to any stake pool operator and will be delegated to the predefined abstain voting option.
This structure helps keep value creation inside Cardano rather than allowing trading activity, liquidity demand, and yield opportunities to migrate to other chains or centralized venues.
Market Context
Perpetual futures are one of crypto's clearest examples of product-market fit. Top-10 perpetual exchanges processed 92.9 trillion USD in 2025 (+64.6% year over year), and the top decentralized perpetual exchanges averaged over 611 billion USD in monthly volume in the first four months of 2026, holding 13.5% of total crypto open interest. Liquidity concentrates where execution is deepest and spreads are tightest. If Cardano does not support competitive perpetual futures infrastructure, trading activity, fees, liquidity demand, and user attention will continue to leave the ecosystem for centralized exchanges and other chains.
Strike's Organic Growth
Strike Finance has already reached meaningful scale without a treasury-backed liquidity program: 1,130,619,017 USD cumulative volume, 968,011 trades, 3,071 unique traders, 1,162,630 USD total protocol revenue, 3,254,391 USD in liquidity provider profit, and over 50% of Cardano trading activity over the last six months.
Ethereum ecosystem users already account for approximately 50% of Strike's trading volume, and Strike's largest trader by volume came from the Ethereum ecosystem. This shows that external traders will use Cardano-native infrastructure when product and liquidity meet their needs.
This is strong organic traction inside Cardano, but small against the global market: DeFiLlama reports approximately 588 billion USD in 30-day decentralized perpetual futures volume, with the largest protocol alone at approximately 188 billion USD. Strike does not need treasury support because demand is unproven. Strike needs deeper liquidity because product-market fit exists, and liquidity is the main constraint preventing Cardano-native perpetual futures from competing at larger scale.
12-Month Objective
This proposal is a temporary liquidity acceleration mechanism, not permanent treasury dependency. By the end of the 12-month deployment, Strike aims to rank as a top-20 perpetual futures protocol across the broader crypto market, measured by public rankings such as DeFiLlama's perpetual futures leaderboard, with enough liquidity depth, external trader participation, and momentum to continue scaling without additional treasury assistance. If the deployment does not produce a credible path toward top-20 competitiveness, renewal should not be assumed; any continued participation requires a new governance proposal with updated performance data.
Terms, Deployment, and Yield
| Term | Detail |
|---|---|
| Requested amount | 9,000,000 ADA |
| Duration | 12 months |
| Structure | Productive liquidity deployment |
| Grant funding | No |
| Net Change Limit | Fits within the current 2026 Net Change Limit |
| Previous treasury funding | None -- Strike Finance has never received Cardano Treasury funding |
| Treasury ownership | Treasury retains ownership throughout deployment |
| Midpoint distribution | Realized yield returned at six months |
| Final return | Principal plus remaining realized yield returned at 12 months |
| Strike custody | Strike will not have unilateral custody or control |
| Oversight | Independent multisig, third-party assurance, and public reporting |
| Future participation | Requires a new governance proposal after 12 months |
The deployed ADA will be sold for USDM at deployment to provide stablecoin-denominated liquidity, executed in an orderly manner to minimize market impact. Modeling at ADA = 0.15 USD: approximately 1,350,000 USDM deployed at a modeled 10% USD-denominated annual percentage rate, generating approximately 135,000 USD / 900,000 ADA-equivalent in annual yield. These are modeled estimates, not guaranteed returns. Realized yield from the first six months is returned to the Cardano Treasury at month 6. At month 12, 100% of treasury-owned deployed assets, including remaining principal and realized yield, will be returned to the Cardano Treasury.
Administration, Custody, and Oversight
Administrator: Independent council. A council composed of Rami from Snek, Phil from Surf, and James from Monetra will receive the treasury withdrawal, hold funds prior to deployment, and oversee disbursement in line with this proposal.
In compliance with Section 7 "Treasury Withdrawals" of the Cardano Constitution Action Standards, any ADA held by the administrator prior to further disbursement will be kept in one or more separate accounts auditable by the Cardano Community, will not be delegated to any stake pool operator, and will be delegated to the predefined abstain voting option. The designated holding account(s) will be published prior to on-chain submission.
Operational custody of deployed liquidity will be governed by an independent multisig with Rami from Snek, Phil from Surf, and James from Monetra. Strike Finance will not have unilateral access to treasury funds during the deployment period. Treasury principal remains ecosystem-owned, deployment activity remains publicly auditable, realized and unrealized profit and loss are reported separately, and any material risk event must be disclosed.
Independent Audit and Assurance
Strike V2 is live on mainnet with public performance history. The protocol has undergone several unofficial reviews by individual technical reviewers. Christian Schmitz, founder of the Helios programming language and Pulse, is currently conducting an official audit of the protocol, which is expected to be finalized by July 1, 2026. The report will be published upon completion.
Independent third-party assurance reports will accompany deployment confirmation, the month-6 yield distribution, and the month-12 return of funds, verifying balances, profit and loss, drawdown, and distributions against on-chain data.
Previous Treasury Funding
Strike Finance has never received funding from the Cardano Treasury or any related ecosystem treasury program, including within the last 24 months. This is Strike Finance's first treasury proposal.
Risk Summary
The treasury may earn less than modeled, experience drawdown, or underperform a simple hold-ADA strategy. Primary risks: ADA price appreciation risk (deployed ADA is sold for USDM and may underperform holding ADA if ADA rises significantly); USDM depeg, custody, liquidity, or redemption risk; smart contract risk; yield underperformance from market conditions; and custody and operational risk around multisig coordination. Governance review is triggered if drawdown exceeds 8%, if reporting is missed for two consecutive monthly cycles, or if any unresolved custody, accounting, stablecoin, redemption, or smart contract concern arises; mandatory review at 10% drawdown.
Early Termination and Return of Funds
| Trigger | Action | Timeline |
|---|---|---|
| Drawdown of treasury-owned position exceeds 20% | Mandatory review; multisig signers may vote to wind down | Review within 7 days of breach |
| Reporting missed for two consecutive monthly cycles without remedy | Multisig signers may vote to wind down | Wind-down decision within 14 days |
In any wind-down: positions are exited in an orderly manner, all treasury-owned assets (principal plus realized yield, minus any realized losses) are returned to the designated administrator account, and an audited reconciliation report is published within 30 days. The independent multisig -- not Strike Finance -- controls wind-down execution, so return of funds does not depend on Strike Finance's cooperation.
Net Change Limit
This proposal fits within the current 2026 Net Change Limit. Because this is a productive deployment with 100% of principal plus realized yield contractually returned within 12 months, the net long-term impact on the treasury is expected to be positive rather than a net outflow.
Success Metrics
Success will be measured across three platform metrics: volume, traders, and revenue.
| Metric | Baseline | Target |
|---|---|---|
| 30-day volume | 50,000,000 USD | 1,000,000,000 USD in 30-day volume within 12 months |
| Traders | 2,528 | 5,000 within 12 months |
| Annualized revenue run rate | Approximately 172,000 USD | 5,000,000 USD within 12 months |
Reporting and Value to Cardano
Strike Finance will provide monthly public transparency reports covering deployment status, liquidity utilization, volume, open interest, realized and unrealized profit and loss, yield, drawdown, stablecoin exposure, market quality metrics, distributions, and any material risks or deviations. This proposal benefits Cardano by deepening Cardano-native liquidity, keeping derivatives activity inside Cardano, improving execution quality, generating yield for the Treasury, and creating a measurable model for productive treasury deployments. At the end of the 12-month period, the full treasury-owned position and all remaining realized yield will be returned to the Cardano Treasury.
Rationale highlights
Why some of the largest DReps voted for and against, in their own words. About vote rationales
The Cardano Foundation votes NO. While we recognize Strike Finance as a leader in Cardano-native derivatives, we believe that treasury liquidity of this scale should be deployed through an ecosystem-wide framework rather than a single protocol. A PDF version...
The Cardano Foundation votes NO. While we recognize Strike Finance as a leader in Cardano-native derivatives, we believe that treasury liquidity of this scale should be deployed through an ecosystem-wide framework rather than a single protocol.
A PDF version of this rationale is also made available.
This vote is not a reflection on the Strike Finance team or their V2 launch, both of which we highly value. Our objection lies with the mechanism and timing of this 9,000,000 ada request based on five core factors:
Ecosystem vs. Single-Protocol Approach: Treasury liquidity should be deployed holistically through independent curators to strengthen the ecosystem as a whole.
Insufficient Custody Standards: Relying on a three-person community multisig for custody falls below the administrative and operational standards required for large-scale treasury assets. We highly encourage the usage of the open source smart contracts to manage treasury funds that have been built by SundaeLabs and are being used by Intersect, or otherwise to build in additional security measures and redundancy into this proposal’s setup.
Short Track Record & Unpublished Audit: This deployment would more than double the protocol's current TVL, based on only two months of publicly available performance data. Additionally, the referenced protocol audit remains unpublished, making security and yield assumptions unverifiable at this scale.
Unhedged Ada Price Exposure: Swapping treasury ada for USDM to provide stablecoin liquidity introduces heavy directional exposure. If ada appreciates, the treasury risks significant underperformance without a sufficient mechanism to offset the loss.The Cardano Foundation votes NO. We value the Strike Finance team and their contribution to Cardano DeFi, and we would welcome their participation through an ecosystem-wide liquidity program or a resubmission in a future NCL cycle supported by a published audit and a longer track record at scale. We look forward to seeing Cardano-native liquidity deepened through a framework that grows the ecosystem as a whole.
NOTE on 'Internal Voting':
The fields constitutional and unconstitutional below reflect the CF governance teams' individual opinions whether they are for or against the proposal. Reason for this inconsistency is, that CIP-136 is at the moment only applicable to CC rationales, but we want to record the internal opinions of our DRep assessment transparently as well.As a DRep, I decided to vote NO on the Strike Finance V2 Treasury Deployment proposal. My rationale: I want to be clear at the beginning. I want to support Strike. It is one of the most visible DeFi protocols on Cardano. I recognize the importance of...
As a DRep, I decided to vote NO on the Strike Finance V2 Treasury Deployment proposal.
My rationale:
I want to be clear at the beginning. I want to support Strike. It is one of the most visible DeFi protocols on Cardano. I recognize the importance of liquidity and trading infrastructure for the ecosystem.
I also appreciate that the proposal is not framed as a grant, but as a productive treasury deployment intended to return principal and yield to the Treasury.
However, as a responsible DRep, I must apply a high standard when Treasury assets are exposed to significant risks. For a 9M ADA request, the proposal does not yet provide enough detail, safeguards, or evidence to justify a YES vote. I remain open to supporting a revised proposal if these issues are addressed.
One concern is trade transparency. Strike reports strong growth numbers. However, because Strike V2 trading happens on the Strike execution layer rather than fully on-chain, DReps and the community need more information to verify the quality of this activity.
Strike should publish anonymized V2 trade concentration data, including the top 5, top 10, and top 20 accounts by volume and trade count, the percentage of volume generated by market makers, the percentage generated by the official liquidity vault, self-trade prevention rules, wash-trading controls, and a clear definition of what “unique traders” means.
Another concern is the need for support from the public treasury. The proposal states that Strike has generated millions of dollars in profit for liquidity providers and over $1M in protocol revenue. These numbers make Strike look successful, but they also weaken the argument that Treasury support is necessary.
If the protocol has already generated substantial LP profit and revenue, Strike should explain why the required liquidity cannot come from reinvested protocol revenue, LP profits, or the STRIKE token treasury.
I am also concerned about market timing. The proposal requires Treasury ADA to be sold into USDM. ADA is currently trading at low levels, which makes this a high-conviction treasury decision. Selling ADA at low prices to support USDM liquidity and a private DeFi protocol is difficult to justify without stronger Treasury protection and upside alignment.
Custody is another important issue. A 3-person council is relatively small for a 9M ADA deployment. I would expect a larger and more independent structure, potentially something like a 5-of-7 multisig. Including respected top DReps or other independent ecosystem representatives would add legitimacy and reduce concentration risk. The proposal should also provide exact signers, thresholds, wallet addresses, responsibilities, and conflict-of-interest disclosures before approval.
Audit readiness is also not sufficient yet. Strike has public evidence of prior audit work for older smart-contract components, but the official Strike V2 audit relevant to this 9M ADA deployment has not been published yet. DReps should require the final V2 audit report, audited commit hashes, and deployed contract addresses before approving a treasury deployment of this size.
The proposal should also include a clear commitment that, during the 12-month Treasury liquidity deployment, Strike will not unilaterally change protocol settings or economic terms in a way that materially increases Treasury risk or reduces Treasury upside. Any necessary changes should be disclosed publicly, clearly justified, reviewed by the independent council, and included in regular transparency reporting.
Finally, the proposal does not sufficiently describe how the ADA-to-USDM conversion will be executed. Since the Treasury position depends on selling 9M ADA into USDM, execution fees, spreads, slippage, and counterparties are material risks. These details should be specified before approval, not only reported afterwards.
Overall, I see a potentially interesting idea, but the proposal form is not adequate for the size and risk of the request. It describes the intention, but not enough of the execution plan, audit status, custody mechanics, conflict management, and downside protection.
For these reasons, I vote NO on the current proposal, while remaining open to a revised version with stronger Treasury protection and a more complete risk framework.
If you'd like to support my work, consider delegating to the MANDA pool and backing me as a DRep. Your support is the only way I can get time for governance.
MANDA Pool ID:
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https://pay.cexplorer.io/pay/c0410d5b237b6ec0I am voting YES. We must balance infrastructure funding with ecosystem investment; this proposal offers productive returns when viable yield options are strictly limited. The perpetuals market is thriving, and anchoring this volume on-chain is a strategic...
I am voting YES. We must balance infrastructure funding with ecosystem investment; this proposal offers productive returns when viable yield options are strictly limited. The perpetuals market is thriving, and anchoring this volume on-chain is a strategic necessity.
A PDF version of this rationale is also made available.
I am formally registering a YES vote on the Strike Finance V2 Treasury Deployment proposal.
Each budget cycle demands a pragmatic balance between core infrastructure and ecosystem investment. I support this proposal because it offers productive returns when our viable yield-generation options are strictly limited. The perpetuals market is thriving globally, and anchoring this volume on Cardano is a strategic necessity. The Strike team has executed well—I have used the platform frequently in the past, though I hold no Strike tokens. Crucially, I strongly encourage the team to collaborate with L2 teams (like Hydra and Midgard) to ensure our scaling infrastructure is driven by genuine, high-volume market feedback rather than purely technical theories.
Structurally, securing funds via an independent 3-of-3 multisig is a strong defense against collusion. However, future deployments of this magnitude must expand these committees to further decentralize control and eliminate single points of failure. While I ultimately advocate for a generic, ecosystem-wide stablecoin liquidity mechanism rather than protocol-specific applications, this proposal's strict drawdown limits and 12-month timeline make it a responsible, risk-managed deployment today.
Thank you to the Strike team for building on Cardano.
To all other projects, there is opportunity here, and we are watching and listening.I am voting YES because this proposal is structured as a productive treasury deployment rather than a traditional grant or expense. While there are risks, I believe they should be compared fairly against the execution risks of other treasury proposals, many...
I am voting YES because this proposal is structured as a productive treasury deployment rather than a traditional grant or expense. While there are risks, I believe they should be compared fairly against the execution risks of other treasury proposals, many of which are 100% expenses with no direct return mechanism.
In this case, the Treasury retains ownership of the deployed capital, the structure includes potential yield, reporting, oversight, and a defined return of funds. Strike also has a proven track record of delivering high-quality products and has already demonstrated strong organic traction.
I believe deeper liquidity on Strike can directly benefit the Cardano ecosystem by attracting more users and increasing on-chain activity.