The Rebalancing Problem

Rebalancing is one of the most high-effort parts of investing. And so, it's the place most people miss out.

Let's say you're building a portfolio. Maybe it's 60% ETH, 30% SOL, 10% stables. You've thought through your allocation carefully. Then the market does its thing. Three months later you're sitting at 75% ETH, 18% SOL, 7% stables. Your portfolio has drifted and it no longer reflects the same thing.

You know you should rebalance. But you don't. Because it's tedious, I've got to get my hard wallet, bridge funds for gas. So instead we wait. And now the portfolio drifts further from what you actually wanted.

Unlike Traditional finance where you have automatic rebalancing where a human does it for you. In crypto that would be very complicated, you end up having to do this manually so you can maintain op-sec hygeine.

This is ineffient.

What Rebalancing Should Look Like

After building Lomen and talking to dozens of traders and retail investors, we think there's a better model:

1. You stay in control - Assets never leave your wallet. No custody risk, no permission needed to move them.

2. Lomen does the math - Automatically monitors your positions and calculates what needs to change.

3. You approve the action - Get a notification when it's time to rebalance. Review it. Execute with one click if it makes sense.

It's the difference between "check your portfolio and figure out what to do" and "here's what needs to happen - yes or no?"

Why would I rebalance though?

Maximizing upside:

• New positions (eg: in a prediction market, token or perp) that reflect the basket’s main idea may be found that may be added or substitute existing positions

• An asset inside the basket may outperform so increasing the weights of that.

• Baskets that copy other external parties may see new allocations coming in

• Systematic Investment Plan - recurrent baskets

• Trading strategy - grid, DCA (SIP) - that might be buying and selling to grow portfolio size (based on user preference)

Minimizing downside:

• A stablecoin is depegging - based on price triggers you can move from one stablecoin to the other.

• Liquidity in a market is low, so exiting to minimize risk.

• Liquidation rebalance on perps and lending - this will be for later.

There will be lots of such examples given baskets are programmable.

It's Built Into Baskets

With Lomen Baskets, rebalancing is baked into the container itself.

When you invest in a basket, say, a 50/50 BTC /ETH split the system tracks your actual allocation over time. When drift hits a threshold (say, 5%), you get a notification: "Your basket has drifted. Rebalance?"

Click in. You see exactly what's changed, what the suggested trades are, and what it'll cost in fees. You can adjust the parameters if you want. Then execute - one transaction, done.

And because everything executes from your wallet, you're never locked in. If you disagree with a rebalance suggestion, don't do it. If you want to pull your assets out entirely, they're yours.

This Is Different

Most rebalancing tools treat you like you're either too lazy to do it yourself or too unsophisticated to be trusted. That's the wrong frame.

The real insight is that rebalancing is a solved problem in terms of logic - we know how to calculate optimal allocations. The unsolved part is the execution layer: making it easy enough that people actually do it, while keeping them in control.

That's what we at Lomen are building toward. Apply to test it here.