How Liminal Customized Works

Overview: When you deposit USDC into Liminal Customized, the protocol automatically opens two matched positions with your funds:

• A long position in the spot market for a given asset (e.g. buying $BTC or $HYPE with a portion of your stablecoins).

• A short position of equal size in the perpetual futures market for that same asset.

By going long and short on the same asset, Liminal creates a hedged pair that neutralizes price movements (delta ≈ 0). This means if the asset’s price moves, the gains/losses on one side are offset by losses/gains on the other, keeping your net position value stable. With price risk neutralized, the strategy then earns yield from:

Perpetual funding payments: On Hyperliquid, traders holding long perp positions periodically pay funding fees hourly to short traders when the perp price is above the spot price (and vice versa when below). As Liminal holds a short perp, it collects funding payments paid by long traders. These funding rates are driven by market demand for leverage.

All yield is real yield, not reliant on any token emissions or inflation. There are no reward tokens, only returns generated from market mechanics.

Automation: The entire process, opening positions, rebalancing, risk management, is fully automated by Liminal’s engine. Key steps include:

• Deposit Execution: The moment you deposit, Liminal executes the strategy: buying the spot asset and shorting the perp in the correct ratio, in real time. Your deposit is instantly deployed into the strategy.

• Yield Collection: Funding fees from the perp are collected continuously and accrue to your balance.

• Risk Mitigation: Liminal’s Liquidity Engine actively manages risk. It uses measured leverage and built-in user-level cap and buffers aiming to avoid liquidation events. If needed, it will reduce exposure or fully close positions in a controlled manner before a liquidation point is hit. These controls are designed to preserve capital and keep the strategy healthy. While no DeFi system is entirely risk-free, Liminal inherits Hyperliquid’s robust risk framework to keep strategies stable and capital protected

• Transparency: Every action (trades, rebalances, fees) happens on-chain through Hyperliquid’s infrastructure and can be monitored. The Liminal app provides real-time tracking of your position’s performance and even an on-chain verification of strategy actions via a Verify button in Your Activity section.

Summary: In Liminal Customized, you deposit stablecoins → Liminal opens a hedged spot/perp position → yield accrues from funding → you can withdraw your Liminal balance anytime. All of this occurs without you managing any trades. The benefit is consistent, market-neutral yield that doesn’t depend on token incentives. Enable Self-Custody anytime in a few clicks.