The Transparency Issue

Welcome Back to PIKUP

Welcome to the second edition of PIKUP, your weekly window into the PikuDAO ecosystem.

This week, we're leading with transparency. As many of you have seen, we experienced a temporary yield impact due to an external event affecting one of our backing portfolio's underlying positions. We'll break down exactly what happened, what it means, and what comes next.

That's what this newsletter is about: truth, transparency, and trust—especially when it matters most.

Let's get into it.

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Piku Protocol Update

Addressing the Yield Impact

What Happened:

A short-term drawdown in reported yields was recorded following the Chapter 11 filing of First Brands Group (FBG), an underlying exposure within the mF-ONE–managed funds included in our backing portfolio.

Key Facts:

• 7-Day APY: Currently in the ~6% range (down from >14% last week)
• Impact: Isolated to the affected instruments only
• Action Taken: Prudent valuation adjustment applied
• Position Status: Remains active within the restructuring process—recoveries may still occur

The Silver Lining:

Despite this temporary impact, performance from the remaining components of the backing portfolio helped offset most of the downside. This is exactly why we maintain a diversified backing strategy.

What's Next:

Based on the manager's outlook, performance is expected to normalise toward the typical +1% to +2% monthly range in the subsequent pricing cycle. We will continue to monitor developments related to the restructuring process closely and communicate material updates as they arise.

For our full statement, see our post on X/Twitter.

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Performance & Stats

Here are this week's numbers:

• Transparency Dashboard: dune.com/piku_dao

Governance

Following last week's successful passage of Proposal 9 (increasing BMMF allocation to 65%), the DAO continues normal operations. No new proposals this week. Any upcoming proposals will be announced via our governance channels on Snapshot.

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Macro Developments

A look at the broader market forces shaping our world.

United States

• Markets Pause at Record Highs: The S&P 500 fell ~0.4% on Monday to ~6,841, pulling back from Friday's close of 6,870. The Dow dropped ~0.6% and the Nasdaq eased ~0.2%. Even with the pullback, the S&P 500 is up ~17% YTD and the Nasdaq is up over 22%.
• Jobs Data Delayed: The November employment report has been pushed to December 16 due to the government shutdown. September data (released in late November) showed +119K jobs, above expectations.
• Fed Watch: All eyes are on the FOMC meeting concluding December 10. Markets are pricing in an ~87% chance of another 25bps rate cut. This would be the Fed's third consecutive cut, bringing rates to 3.50%-3.75%. Decision and Powell's press conference at 2:00 PM ET Wednesday.

Europe

• STOXX 600 Steady: The pan-European index ended the week at ~578.87, up ~0.4% for the week. Germany's DAX advanced 0.7%, helped by political relief after Chancellor Merz secured a key pensions vote.
• Sector Winners: Autos & parts jumped 5.6% for the week; retail climbed 5% on strong November sales from Inditex; tech rose 2.7%.
• ECB Outlook: Inflation near the 2% target means rate hikes are unlikely. Analysts expect the lagged impact of earlier ECB cuts to benefit the real economy in 2026.

Japan

• Nikkei Holds Firm: The Nikkei 225 closed at ~50,651 on December 9, holding above 50,000 amid rate hike speculation.
• BOJ Rate Hike Incoming: Governor Ueda signaled the BOJ is weighing the "pros and cons" of a December hike. Markets now price a 76% probability of a rate increase at the December 18-19 meeting, potentially bringing rates to 0.75%—the highest since 1995.
• JGB Yields Surge: The 10-year JGB yield pushed to ~1.9%, its highest level since 2007.

China

• Markets Mixed: The CSI 300 closed at ~4,584 (+0.84%). The Hang Seng is up ~30% YTD, on track for its strongest annual gain since 2017.
• Trade Data Ahead: Markets await November trade figures, with analysts expecting ~8.5% export growth and ~2.5% import growth YoY.
• Valuation Gap: Mainland and Hong Kong stocks trade at ~12x forward earnings vs. ~28x for the S&P 500—a sizeable discount that continues to attract global flows.

Crypto Markets

• Bitcoin: BTC trading at ~$91,500, up ~2.4% in 24 hours but still consolidating below $93,000. The market remains cautious after December's earlier drop to ~$86,000.
• Ethereum: ETH at ~$3,130, up ~3.3%—the top performer among the top 10. Recovered ~21% from its recent low of $2,623.
• Fusaka Hard Fork Live: Ethereum's Fusaka upgrade successfully activated on Dec 4. The headline feature—PeerDAS—enables data throughput to scale up to 16x while reducing hardware demands. Vitalik called it "literally sharding... a dream since 2015, now reality."
• ETF Flows Diverge: Spot Bitcoin ETFs saw net outflows of ~$14.9M, while Ether ETFs recorded $140.2M in inflows—capital rotating from BTC to ETH.
• Fear & Greed: The crypto fear and greed index remains in "fear" territory (20-24 range), reflecting continued market caution.
• Institutional News: Vanguard opened crypto ETF trading to clients. Bank of America told institutional clients they may allocate 1-4% of portfolios to digital assets.

Looking Ahead

• Dec 10: FOMC rate decision + Powell press conference (2:00 PM ET)
• Dec 16: US November jobs report (delayed from Dec 6)
• Dec 18-19: Bank of Japan policy meeting (rate hike expected)
• Dec 22: Carvana joins S&P 500

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Partner Spotlight: Stablewatch

Independent Research Recognition

This week, we're not featuring a customer—we're thanking an independent research firm that took a deep dive into Piku.

About Stablewatch

Stablewatch is an independent research platform dedicated to analyzing stablecoin protocols. They provide objective, in-depth analysis to help users understand the mechanics, risks, and opportunities in the stablecoin ecosystem.

Their Research on Piku

Stablewatch recently published a comprehensive research report on Piku Protocol, covering:

• Core Architecture: The three-token system (USP, PIKU, sPIKU) and how they work together
• Backing Strategy: Deep dive into the 50/50 off-chain (BMMF Turkey FX Arbitrage) and on-chain (Ethena, Aave, Giza, etc.) allocation
• Minting & Redemption Mechanics: The KYC requirements, fee structure, and queue-based redemption system
• Security: Analysis of our 4+ audits (Omega Security, 0xMacro, Hats Finance, Audit33)
• Governance: How PikuDAO operates and the role of sPIKU in voting

"Piku introduces a fundamentally distinct stablecoin model where the USP token appreciates in value rather than maintaining a fixed peg. The protocol channels 90% of generated yield back into backing reserves, allowing each token to represent an expanding claim on underlying assets." — Stablewatch

Read the Full Report

We encourage everyone—especially those doing due diligence—to read Stablewatch's independent analysis:

Read the Full Report: Piku: Yield-Optimized Stablecoin

Thank you, Stablewatch, for the thorough and objective research. Independent analysis like this helps the entire ecosystem make informed decisions.

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Community Spotlight: @Luci13131313

This week we're featuring a thread from community member @Luci13131313 who broke down Piku's governance-farming model in a way that clicked with a lot of people.

The Piku Loop, Explained

"Piku basically turned content into Proof of Work."

Here's how @Luci13131313 described the self-reinforcing loop:

1. Create content → gain Delegated Voting Power
2. Vote → earn $PIKU rewards
3. Stake $PIKU → get sPIKU
4. Hold sPIKU → get more $PIKU (compounding machine)
5. Hold $USP → get auto $PIKU rewards → stake again

"It's literally a self-feeding loop that only rewards active members. Not the silent watchers—the builders."

What Sold Them?

"I already create content. I already love governance mechanics. I already enjoy degen tokenomics. And then they hit me with: 'Active governance literally pays you.' Bro that line alone sold me."

Read the full thread

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Want to be featured in PIKUP? Tag us @PikuDAO with your Piku content—threads, memes, explainers, whatever you've got.

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Active Campaigns & Rewards

Earn while you participate in the Piku ecosystem:

1. Zealy Community Quests

The "Future of Finance" campaign continues on Zealy—with new quests now available! Complete quests, climb the leaderboard, and earn rewards.

Join the PikuDAO Zealy Board

2. Merkl Rewards (Pre-TGE)

Current APRs on Merkl (as of Dec 9):

APRs are dynamic and subject to change. Current campaign ends December 11—new campaigns will follow, so keep your positions ready!

View All Piku Opportunities on Merkl

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What's Next?

• Yield Recovery: Expect performance to normalize toward +1-2% monthly in the next pricing cycle
• Piku Airdrop: The campaign continues—keep engaging with the protocol to secure your allocation
• Follow Us: Stay tuned on X/Twitter for announcements on upcoming community calls

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A Note on Transparency

This week reminded us why we built Piku the way we did:

1. Diversification works. The impact was contained because our backing isn't concentrated in a single strategy.
2. Transparency is non-negotiable. We told you what happened, when it happened.
3. Real yield has real risks. We don't promise impossible APYs. When something affects performance, we explain it clearly.

Verify, Don't Trust

Everything we do is on-chain and verifiable. Our real-time transparency dashboard shows you exactly what's backing USP—no quarterly reports, no delayed disclosures, just live data 24/7.

View the Piku Transparency Dashboard on Dune

Thank you for your continued trust. We'll keep earning it.

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Stay Connected and Hedge against the machine!!

Website | App | Twitter (X)

Disclaimer: This newsletter is for informational purposes only and does not constitute financial advice. USP involves risks; please read our documentation and risk disclosures before participating.