Yield IQ: Unleashing the Power of Liquidity Provision

Today, we’re unveiling Yield IQ, a revolutionary tool that seeks to unlock new revenue streams for token holders. This marks a significant leap forward in the world of decentralized finance (DeFi), offering users a simple and lucrative way to earn a fresh source of income from trading fees generated through liquidity provision. Born out of a team of visionary developers and innovators in the DeFi space, Yield IQ seeks to revolutionize the DeFi space by offering an efficient, profitable and user-friendly platform for liquidity provision.

“Yield IQ has unveiled an untapped earnings potential for us,” expresses Coburn Murray, CEO of Ethos Capital. The fund has been leveraging AAVE and Yield IQ to increase ETH-denominated yields on Polygon. “This combination has enabled us to significantly enhance our ETH earnings,” Murray adds.

The Promise of Yield IQ

Yield IQ disrupts conventional wisdom by challenging the belief that trading fees minus impermanent loss leads to a divergent loss for volatile tokens when supplying them to automated market makers (AMMs). Instead, Yield IQ operates like a relentless profit generator, mitigating risks and earning income for token holders. Imagine a tireless workhorse that ceaselessly attempts to accrue profits on your behalf; that’s Yield IQ.

How Does It Work?

The process is relatively straightforward. First, you deposit your preferred token. Yield IQ then allocates these tokens into a concentrated liquidity AMMs, such as Uniswap V3, without any swap occurring prior to this deployment. In return, you receive LP tokens, a representation of your share in the liquidity pool.

Here’s where the magic happens: Yield IQ, powered by Chainlink Automation, adjusts the concentrated liquidity position based on the token’s arrangement and market conditions. When trades occur, you earn trading fees, supplementing any appreciation of your token. Yield IQ consistently oversees token composition to guard against harmful arbitrage and drastic market shifts. When you’re ready, you can withdraw your initial deposit and earnings at any time by exchanging your LP tokens for your share of the assets in the vault.

Getting Started

To start using Yield IQ, connect your digital wallet, choose the token you’d like to deposit, and follow the prompts. For now, Yield IQ is available on Uniswap V3 (Polygon) at app.ichi.org and Retro Finance (Polygon), with plans for additional platforms on the horizon. There’s no minimum deposit.

Risk Management

While Yield IQ seeks to minimize risks, like any other DeFi product, there are inherent risks involved. In volatile market conditions, Yield IQ responds and makes rebalancing adjustments. During periods of high volatility, user’s positions are spread across the price range to reduce the potential impact of large price movements. However, this may not execute in a timely manner in all market conditions. As a result, it’s recommended that users maintain hedging positions for long tail risk management.

Looking Ahead

The long-term vision for Yield IQ is to revolutionize the DeFi space by offering an efficient and user-friendly platform for liquidity provision. Its ultimate goal is to help token holders accrue income, mitigating risks, and maximizing returns in an unpredictable and often volatile market. As with any journey, the road will undoubtedly be marked by challenges and obstacles. But remember, the world of technology and DeFi doesn’t evolve in weeks or months but over years and decades. The key is patience and a long-term perspective.

Lastly, it is important to emphasize that while Yield IQ offers a new avenue for earning income in DeFi, it’s crucial to understand the inherent risks involved in any financial endeavor. Always ensure you’re well-informed before deciding to participate.

Thank you for joining us on this journey. We’re excited about the potential of Yield IQ and look forward to seeing how it continues to shape the landscape of DeFi​1​.

About Yield IQ

Yield IQ is a fully automated, single sided concentrated liquidity provision strategy. By making rebalancing decisions based on token composition instead of token price, Yield IQ limits divergent loss and generates industry leading results. True to the spirit of DeFi, Yield IQ is governed by a self-executing smart contract, ensuring impartiality and decentralization. This ensures unrestricted, permissionless acces and unalterable protocol behavior, serving as a truly decentralized financial tool.

Learn more by visiting the Yield IQ Medium or Twitter.

Customer FAQ

What is Yield IQ?

Yield IQ is a fully automated, single sided concentrated liquidity provision strategy. By making rebalancing decisions based on token composition instead of token price, Yield IQ limits divergent loss and generates industry leading results.

Who is the ideal target customer for Yield IQ? What will delight them about it?

Yield IQ is particularly useful for digital asset management firms yet to realize the potential of income from automated market makers (AMMs). This tool challenges the conventional wisdom that trading fees minus impermanent loss leads to divergent loss for volatile tokens. Yield IQ works like a tireless profit generator by combatting this risk. You simply deposit a token and then watch as it accrues earnings.

How does Yield IQ function?

The process is simple: you first deposit your preferred token. Yield IQ then places these tokens into a concentrated liquidity AMM, such as Uniswap V3, to earn trading fees. No swap occurs prior to this deployment. You’ll receive LP tokens in exchange for your deposit. The Yield IQ algorithm, powered by Chainlink Automation, auto-adjusts the concentrated liquidity position based on the user’s token arrangement and market conditions. When trades occur, you earn trading fees, supplementing any appreciation of your token. Yield IQ oversees token composition to mitigate risks of harmful arbitrage and drastic market shifts. Finally, you can withdraw your initial deposit and earnings anytime you wish — just exchange your LP tokens for your share of the assets in the vault.

How can I start using Yield IQ?

For now, you can access Yield IQ on the ICHI app (Polygon network). Simply connect your digital wallet, choose the token you’d like to deposit, and follow the prompts. Check out this quick tutorial on how to deposit your assets and start earning on the ICHI platform. Yield IQ will soon be available on its own app and integrated on additional platforms.

Is there a minimum deposit for Yield IQ?

No. You can deposit as little or as much as you like.

How does Yield IQ manage market volatility?

Yield IQ is designed to respond accordingly to drastic market changes by making necessary rebalancing adjustments. Yield IQ monitors the differences between fast (5 min) and slow (60 min) TWAPs as well as between spot price and fast TWAP. Based on the price differences, Yield IQ recognizes High Volatility (depending on the pool, typically set at 6% difference) and Extreme Volatility (typically set at 25% difference) situations.

During periods of High Volatility, your position will be dispersed across the price range, thereby limiting the significant sale of your preferred token due to price changes.

In situations of extreme volatility, the vault gets locked, preventing further deposits. At this point, the strategy team evaluates the market conditions before making any rebalancing decisions.

Can I deposit any token into Yield IQ?

Generally, Yield IQ supports a range of popular tokens. However, availability can vary, and it’s best to check the platform for the latest supported tokens. If the token you wish to deposit is not on the platform, you can reach out to our team on Discord for consideration.

Is Yield IQ safe and secure?

While Yield IQ incorporates robust security measures and has undergone audits to ensure its safety, like any other DeFi product, there are inherent risks involved. Here’s a non-comprehensive list of potential risks associated with DeFi:

• Smart Contract Risk: Smart contracts are automated, self-executing contracts with the terms of the agreement directly written into code. While they bring efficiency, they also can contain bugs or vulnerabilities that hackers could exploit.
• Impermanent Loss: When providing liquidity to AMMs, the changing ratio of your deposited assets can lead to losses compared to simply holding them, especially during high volatility periods. This is referred to as impermanent loss.
• Extreme Market Volatility: Rapid, significant changes in token prices can lead to major losses, as seen in instances of high and extreme market volatility.
• Regulatory Risk: Regulations around DeFi are not fully formed, and changes in legal standing can affect the value and operation of DeFi products and services.
• Platform Risk: The platform on which DeFi applications operate, such as Ethereum, can also pose risks including network congestion, high transaction fees, and potential underlying vulnerabilities in the blockchain.
• Liquidity Risk: There’s a risk that you might not be able to exit your position due to insufficient liquidity in the market, particularly in smaller, less popular tokens.
• Counterparty Risk: While DeFi aims to be decentralized, some protocols may still have elements of centralization, introducing counterparty risk.
• Operational Risk: As with any business operation, there are risks related to the operation of the DeFi protocol itself, including governance issues, risk management practices, and the protocol’s strategy.
• Risk of Interconnectedness: DeFi protocols often interact with each other. A failure or exploit in one protocol could have a domino effect, causing failures in other connected protocols.

In conclusion, while Yield IQ aims to minimize these risks through various security measures, users should always be aware of these risks and make informed decisions when engaging with Yield IQ.

How is Yield IQ different from traditional staking?

While similar in simplicity, Yield IQ not only allows you to earn from your token’s appreciation but also from trading fees, adding a new stream of income. You can learn more about staking, liquidity providing and the pros and cons of each here.

What’s the long-term vision for Yield IQ?

The long-term vision for Yield IQ is to revolutionize the DeFi space by offering an efficient and user-friendly way to earn returns from liquidity provision.

Who is behind Yield IQ?

Rather than being controlled or managed by a specific group or organization, Yield IQ is governed by a self-executing smart contract, which ensures impartiality and decentralization. Born out of a collaboration between ICHI and Bril Finance, it echoes the spirit of DeFi, existing without centralized authority, ensuring unrestricted, permissionless access and unalterable protocol behavior, thus serving as a truly decentralized financial tool.