🔒Connected Custody

In the Fume platform, the fund manager is responsible for connecting a custody solution to receive incoming subscriptions. This custody solution can vary depending on the manager’s preference and needs. It could range from a self-hosted wallet, such as a hardware wallet, to more complex setups like multi-signature wallets (e.g., Safe Wallet), MPC (Multi-Party Computation) solutions, or even a centralized exchange.

Moving Liquidity to the Fund Address

Once the Net Asset Value (NAV) calculation is completed, the subscription liquidity that was initially held in the smart contract is moved to the connected custody solution, referred to as the "Fund Address". This process ensures that all investor capital is appropriately accounted for and moved into the custody environment defined by the fund manager.

Full Flexibility in Asset Management

Fume’s protocol focuses strictly on the administrative processes surrounding fund management, giving the fund manager complete freedom in managing the underlying assets. This means that once the liquidity is transferred to the Fund Address, the manager can hold, trade, and manage assets across various platforms. The managers can use different exchanges, brokers, or even off-chain positions as long as they can reconcile the positions to compute the total assets of the fund for accurate NAV calculations (see how the NAV Calculation works).

Broad Range of Asset Types

The assets held within the fund can span multiple categories:

• On-Chain Assets: Digital assets such as cryptocurrencies, which are natively supported by blockchain technology.

• Centralized Exchanges: Assets traded on digital asset exchanges that are custodial in nature.

• Traditional Brokers: Traditional financial assets like stocks, commodities, or bonds managed through brokerage accounts.

• Private Equity and Real Estate: Non-traditional or illiquid positions such as company shares, real estate, or venture capital holdings.

The flexibility provided by Fume ensures that fund managers can tailor their asset management strategies while still benefiting from the platform’s automated fund administration features​​​.