Date Updated: August 1, 2022

Investment Methodology

PennyWorks follows stringent risk management guidelines to ensure that funds are secure, yields are consistent, and risk is lowered across all possible touch points.


PennyWorks uses the PennyWorks Notes to fund collateralized loans through various Decentralized Finance (DeFi) protocols. Extensive risk management procedures have been set up in order to vet various protocols in the decentralized web ecosystem (web3) and help ensure that funds are only placed in responsible protocols with proven track records.

Review Process

While the ecosystem is evolving at a rapid pace, each protocol is reviewed on a holistic approach driven by analysis across a number of factors, including but not limited to:





  1. Security: The design and tokenomics of the protocol, source code and implementation of those designs.
  2. Liquidity: The ease with which assets can be transferred across blockchains, placed into/out of a particular protocol, as well as the market impact of such transactions.
  3. Economics: The market need that is fulfilled by the protocol, how the protocol adds value, the applicable risk parameters, the relevant governance processes, and PennyWorks exposure as a participant.
  4. Macro: These factors include how a given protocol interacts with other protocols and related ecosystems, such as exchanges, traditional financial services and market participants.

Furthermore, where available, third-party audits are also reviewed to provide multiple perspectives on each protocol.

Vetted Protocols

The protocols used may change from time to time. Currently, the following protocols have been vetted for use:

This is a non-exhaustive list as many decentralized exchanges derive from the same source code and liquidity dynamics at any point in time might vary greatly based on market conditions.

2 Some of these protocols include other DeFi products such as Automated Market Making (AMM) and Liquidity Pool (LP) staking. Only their exchange functionality is currently used.

Investment Objectives

Within the vetted protocols, the aim is to maximize yields while maintaining a highly liquid profile. Some of the factors that are considered include:

  1. The proportion of investments relative to the total liquidity within any protocol on a per blockchain and per asset basis.
  2. The ease of converting assets back into USD with minimal market impact.
  3. The duration of loans.
  4. Diversification of holdings across protocols.
  5. The transaction costs, market impact and fees associated with switching between protocols.

Offering Documents

Please log in or create an account to view additional Investment Documents for this offering.

The above information is illustrative of certain aspects of the PennyWorks Notes as of the date hereof.  Those aspects may change from time to time at any time without notice and PennyWorks has no obligation, and assumes no duty, to update this page or you regarding the same.
The PennyWorks Notes are securities issued by HybridFi Lending LLC dba PennyWorks (“Issuer”). Furthermore, the information on this page is a summary of certain aspects only and does not purport to be complete and should not be considered a part of the private placement memorandum or other documentation of the offering (“Offering”), or as incorporated in the private placement memorandum by reference or as forming the basis of the Offering.
No person has been authorized to give any information or to make any representations about the Offering other than those contained in the private placement memorandum, and, if given or made, such information or representations must not be relied upon.  All investors must read the private placement memorandum in its entirety prior to investing in the securities.

By clicking “Accept All Cookies”, you agree to the storing of cookies on your device to enhance site navigation, analyze site usage, and assist in our marketing efforts. View our Privacy Policy for more information.