# Investment Objectives & Strategy

## **Investment Objective**

The digital asset space has witnessed investors gravitating towards high returns, be it through high APYs via liquidity mining or ICO speculations. However, post-2022, it became evident that the potential risks of such investments were often overlooked. As the crypto industry evolves and attracts more sophisticated participants, there's an increasing need for a balanced focus on both returns and risk management.

This is why tfBILL is designed with the simple goal of providing low-risk yield, anchored by stable, liquid, Short-Term US Treasuries:

* **tfBILL's Exposure**: A pool of short-dated U.S. Treasury securities
  * **Class / Token**: tfBILL
  * **Asset Exposure**: US Treasuries
  * **Target Yield**: Effective Federal Funds Rate (currently \~4-6%)
  * **Liquidity**: Daily

## **Investment Process**

1. **USDC to USD Conversion**: When you invest your USDC in tfBILL, the first step is to exchange the USDC for USD. 
2. **Asset Purchase**: The USD is utilized to acquire short-term government securities.
3. **Token Minting**: Corresponding to your investment, new tfBILL tokens are minted and transferred to your wallet.
4. **Yield Reinvestment**: As the underlying assets generate yield, this yield is reinvested to acquire additional assets, effectively auto-compounding your returns.
5. **Redemption**: If you decide to redeem your investment, your tfBILL tokens are burned, and you are returned the equivalent value in USDC.

## **Focus on Capital Preservation**

Both Short-Term US Treasuries and investment-grade corporate bonds have historically been low-risk investments. Their primary objective is capital preservation, ensuring the principal remains intact while generating some yield.

For context, consider the performance of various assets from Nov 2021 - Nov 2022. During this period, major indices like the S\&P 500 and NASDAQ saw significant drops, and even BTC experienced a substantial decline. In contrast, specific Short-Term US Treasuries ETFs, like the example provided, saw a positive return.

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