What is Umami Finance (UMAMI)?
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🟢 The simple version
Plain English — no jargon. Start here.
Umami Finance builds delta-neutral GLP vaults on Arbitrum — earn GLP's high real yield (~15-30% APY in trading fees) while hedging away the directional ETH/BTC exposure through simultaneous short positions.
Delta-neutral GLP
GLP (GMX's liquidity pool token) earns 70% of all GMX trading fees — genuinely high real yield. But GLP holds ETH, BTC, USDC — so you have directional crypto exposure. Umami: hold GLP for yield + short ETH/BTC to neutralise price exposure = earn fee yield without caring about crypto price direction. ~1M UMAMI very low supply + performance fee share. Hedging costs reduce net yield but remove directional risk. v2 expanded beyond GMX to other Arbitrum yield sources. Is UMAMI legal in India? Yes. 30% tax, 1% TDS apply.
🟡 A bit more detail
For when you want to go a little deeper.
UMAMI risks
Basis risk: short positions may not perfectly offset GLP movements. Hedging has ongoing costs (perpetual funding rates). Concentrated GLP trader losses compress GLP yield. ~1M UMAMI is extremely low supply — meaningful per-token fee revenue at scale.
🟣 The full technical picture
For the technically curious.
Key facts
- Token: UMAMI (~1M, very low supply)
- Strategy: GLP yield + ETH/BTC short hedge
- Chain: Arbitrum
- Yield: GLP fees (~15-30% APY) minus hedging cost