Single-sided Staking with ShapeShift and Idle Finance

4 min readJan 9, 2023

ShapeShift is excited to announce our complete support and integration with Idle Finance, a decentralized protocol that aims to unlock the power of decentralized finance as a one-stop source of yield. Partnering with Idle Finance marks a new chapter in our FOX family’s ability to earn an even more diverse array of yield offerings with various risk strategies on our open source, community owned, and free web app. Preceding this integration with Idle Finance, we developed a single-sided staking abstraction layer to streamline the integration of new protocols一such as Idle Finance一with similar UI/UX to our Yearn integration. This partnership is the next step in providing users access to more yield-generating protocols and opportunities than ever before.

What Is Idle Finance?

Idle Finance is a decentralized protocol that offers yield automation and risk tranching infrastructure for DeFi. From institutional and DAO treasury managers to high-net worth individuals, a vast range of liquidity providers use Idle to optimize capital efficiency and tailor their risk exposure to personal needs.

Idle Finance allows users to algorithmically optimize their digital asset allocation across leading DeFi protocols, whether they want to maximize it via Best Yield or keep tabs on their risk/return profile via Senior and Junior Perpetual Yield Tranches. Idle boasts three yield products:

Best Yield一their flagship yield automation strategy that optimizes funds across multiple battle-tested DeFi protocols
Senior Tranches一Protected Yield一the innovative safeguard strategy that provides built-in fund coverage features on third-party DeFi products
Junior Tranches一Boosted Yield一the forefront strategy that amplifies yield generation

This integration supports all three products一Best Yield as well as Senior and Junior Tranches一offered by Idle and allows our ShapeShift users full access to features available on Idle Finance.

What Can I Do With Idle Finance on ShapeShift?

You can now see all available Idle Finance vaults as well as a comprehensive breakdown of those vaults (TVL, APY, reward assets) under the Earn tab or Overview tab. These vaults include Best Yield and Senior & Junior Tranches on the Ethereum network. Enter, exit, and manage your position within all of the available Idle contracts through ShapeShift一just as if you were in native Idle Finance一all with no added fees or KYC.

Best Yield

Best Yield optimizes the interest accrual process across multiple protocols to achieve the highest rates at all times; deposited funds are automatically rebalanced between protocols like Compound and Aave as rates change continuously. This strategy is one of the longest-running and battle-tested DeFi products, released in 2019 and secured by multiple audits. Best Yield supports DAI, USDC, USDT, WBTC, WETH.

Perpetual Yield Tranches (Junior and Senior Tranches)

Perpetual Yield Tranches are an innovative DeFi primitive using risk tranching to split any existing yield source into two different risk-return profiles: Senior and Junior.

Senior Tranches intrinsically have a first lien on the underlying assets — they’re first in line to be repaid in case of default (hack or loss of funds). This product provides full-spectrum coverage, as the loss is covered regardless of the dependency or underlying protocol that caused it. Learn more about covered events here.

The Junior class is rewarded with a greater share of the underlying yield in exchange for taking on eventual losses. The integrated Junior and Senior tranches support the following assets:

Lido: stETH
Euler: DAI, USDC, USDT, agEUR
Clearpool: USDC

Furthermore, the integration of incentivization programs supported by Idle DAO is in the pipeline.
Both Best Yield and Senior Tranches benefit from IDLE rewards, along with third-party incentives on some specific Tranches (e.g., receiving $LDO rewards on stETH Senior Tranche thanks to the DAO2DAO collaboration between Idle and Lido).

Shapeshift and Idle teams will work to enable this functionality in the near future, empowering ShapeShift liquidity providers to receive extra rewards in the form of protocol ownership ($IDLE governance tokens) and $LDO incentives.

The Future of Earning With ShapeShift

With our mission to become the single-source app for all things DeFi, we are excited to offer a one-stop solution for your funds. With Idle Finance, users can stay ahead of the curve with a range of robust DeFi yield products. We are honored to partner with protocols such as Idle Finance, where our ethos greatly align and we can all contribute to building a better financial infrastructure for Web3.

All Chains, All Protocols, All Wallets. Share Our Vision at app.shapeshift.com