June 6th Drawdown Report Background PiggyBank's core strategy over the past months has been funding rate arbitrage (i.e. taking both long and short positions on the same asset through perpetual futures to benefit from funding rate differences), and basis trading (i.e. taking spot positions and hedging price exposure via perpetual futures shorts to capture funding). This strategy generated consistent returns throughout the life of the protocol, and continues to do so. Users who joined PiggyBank understood that the protocol operated with limited position-level disclosure, a standard practice designed to prevent front-running and strategy dilution. The LAB Situation PiggyBank entered a basis trade on LAB in early May through a reputable OTC intermediary. The deal involved buying locked 142,857.14 LAB tokens (for $102.5k) at a substantial discount to spot price at the time (≈80%). A short position was opened on two perpetual DEXs (Aster, Aden) to hedge the long spot exposure. Considering the price action at that time, we decided to only hedge part of our exposure initially and gradually increase it as the price moved higher. What followed appeared to be a market manipulation scheme. Market participants with significant influence over the circulating supply appeared able to sustain spot prices above perpetual futures prices for an extended period. Under standard perp mechanics, this forced funding rates deeply in negative territory, reaching -17,000% annualized, or roughly -2% per hour. The result was that maintaining the hedge became economically impossible for short sellers. Unwilling to continue bearing these funding costs, the short position was closed, at a price of ~9$, realizing a net loss of $476,428.70. Following the closure, the price of LAB increased significantly, reaching $27. Had the short position remained open, it would have incurred substantially larger losses. The locked LAB position currently has a spot value of approximately $1 million at prevailing market prices on June 10, 2026. However, due to its illiquid nature and the absence of a hedge, it has been excluded from NAV calculations pending its unlock on August 14, 2026. As a result, pb-token holders experienced a net drawdown of $578,928.70 on June 6, 2026. This NAV update allows the share price to accurately reflect the funds remaining in the vault that continue to be deployed in legacy funding-rate strategies, free of illiquid positions, while maintaining a separate record of users impacted by the drawdown. What Is Changing PiggyBank is undergoing a structural evolution of the platform designed to address the issues involved in the LAB events. The primary objective is to strengthen the protocol’s transparency by expanding the use of decentralised on-chain mechanisms. Under this model: - Strategy logic and allocation mechanisms will be publicly disclosed and verifiable on-chain. - Capital deployment will follow on-chain systematic and auditable rules. - Revenue generation and fee collection will be visible to users. Basis trade and funding rate arbitrage are not the best fit for the protocol’s evolving strategic framework. It will therefore be phased out over the coming weeks and replaced by approaches that are better aligned with the protocol’s long-term objectives. Details regarding future on-chain strategies will be communicated before the end of June. Compensation PiggyBank is developing a potential recovery framework related to the LAB event. The framework currently under consideration would aim to create additional value for the community and reinforce long-term alignment across the ecosystem through the following measures: - A snapshot of impacted users has already been recorded. - Eligible users would receive reimbursement allocations proportional to their realized losses resulting from the exclusion of LAB from NAV calculations. - Reimbursements would be funded, in USDC, from the distribution sources that follow: 1. The June 6 NAV reflected a displayed loss of $645,701.35, which was $66,772.65 higher than the final calculated drawdown of $578,928.70. This difference has been allocated back to affected users. 2. Any future LAB sale. As the LAB position unlocks, starting on August 14, 2026 until October 14, 2026, the position will be liquidated in full. On 10/06/2026, it is worth ~$1m at spot price. 3. 50% of net future platform revenues would be distributed in the recovery pool. - The reimbursement process would continue until the allocated recovery pool has been exhausted or users have been fully compensated. - The distribution would be made in USDC and would be claimable through the Portfolio tab of the PiggyBank web application. Any user present at the snapshot of epoch 113 (on June 6, 2026) will be included in compensation distribution whether or not they still hold a position in any of the vaults. The PiggyBank Team

Dear Community, - One month ago, PiggyBank got into a new position for $100k (~2% of the portfolio at the time), as part of the strategy’s scope of deploying into mid-cap basis trades. - The strategy involved purchasing locked $LAB tokens at a significant discount through a Tier-1 OTC desk and hedging that exposure through perpetual shorts. During the holding period, $LAB experienced violent manipulation, including chaotic price movements on thin liquidity, and deeply negative funding rates. - Maintaining the hedge became economically irrational and would have caused us to cross our risk thresholds. We therefore decided to close our short to cap the downside. - In accounting terms, the total value of our $LAB locked position is $1.35m at current prices. However, due to the illiquid nature of this position, Piggybank is excluding it from the NAV until the first unlock on August 14. Even though this is an evolving situation that could still generate substantial returns, this is the fairest and most transparent way to let users manage their liquidity. - Accordingly, today’s NAV will show a ~15% drawdown on the USDC vault, ~12% on SPYx and ~9% on JitoSOL. - A detailed report will be published next week with next steps.

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1/ For a decade, Web3 and TradFi argued. In 2026, they're sitting at the same table. In 10 days, Jenny Johnson (CEO @FTDA_US, $1.5T AUM) and @adam3us (Co-Founder, @Blockstream , inventor of Hashcash) open Proof of Talk 2026 on the same stage. That fireside is the thesis of the entire event. @proofoftalk

> deposited SPYx on @piggybank_fi > farmed 5x xPoints (over 400K) > SPYx hit ATH > got extra 10% APY on SPYx > qualified for Piggybank revenue share But hey, Airdrop farming is dead...

Click any address on the leaderboard (Oinks tab) to see their Season 0 rewards. S0 was the warm-up. S1 is live. 8 months to farm your way up 💸 Thanks @jussy_world for following our journey since day one 🐽

Tokenized stocks market cap hit $1.2B. That's +2,053% in 12 months. You are not bullish enough And you can also farm airdrops from it If you missed it, this is the best strategy to farm @xStocksFi while farming 2 other airdrops simultaneously 👇

6 hours until the Season 0 rewards announcement 👀 In the meantime, huge thanks to the 69 contributors who helped build high-quality tools and content for the PiggyBank ecosystem 🩷🐽