Introducing the RWA Best Yield Vault
A diversified USDT vault on top of tokenized credit markets
Idle DAO is excited to announce the latest Best Yield iteration: a fixed allocation vault to offer simplified and diversified access to institutional real-world asset (RWA) credit lending.
The first Best Yield vault with a fixed allocation is released on Optimism, built upon the USDT lending pools of Fasanara, Portofino, and Bastion Trading on Clearpool. A fixed allocation vault provides users with diversified allocation weights, streamlining the investment process by automatically allocating funds across lending pools within the tokenized credit market.
Background
In 2019, Idle launched the Best Yield vaults, marking a significant milestone in yield automation strategy. These vaults were designed to maximize returns by aggregating and optimizing funds across multiple lending protocols. Building upon this foundation, Idle later introduced Yield Tranches, offering users two distinct tranches with varying risk exposures: Senior and Junior.
Over the years, product development at Idle has remained focused on the vision that the aggregation and tranching features provided by its vaults should synergize to create new opportunities for maximizing capital efficiency based on varying risk appetites. This vision has led to the addition of new markets and the establishment of the suite as a reliable source of yield. The suite now offers an increasing number of risk-adjusted and automated solutions for major crypto assets, all while providing single-side exposure and avoiding impermanent loss or lockups.
RWA sector
The new BY vault marks a pioneering step in RWA yield product offerings, providing diversified and unified risk exposure to the burgeoning tokenized private credit sector. This sector currently boasts approximately $500 million in on-chain assets, with the potential to tap into a vast $1.6 trillion market in traditional finance.
The vault opens doors to a plethora of new private credit yield sources waiting to be integrated. Clearpool, with its permissionless nature, will be the first credit marketplace integrated into the vault. Following this integration, other leading credit marketplaces such as Centrifuge, Maple, and Goldfinch could potentially be integrated. This approach not only diversifies risk but also expands the potential for higher yields and broader coverage of real-world assets, ensuring continued innovation and growth in the Idle ecosystem.
Vault features
From a yield perspective, the equally weighted fixed allocation positions itself between the aggregation pooling of the Best Yield markets and the siloed deposits of Yield Tranches. It caters to users seeking diversified risk exposure to the institutional lending market while mitigating risks associated with on-chain lending.
The newest diversified RWA vault integrates the Senior tranche markets of Fasanara Digital, Portofino Technologies, and Bastion Trading’s borrower pools on Clearpool. Available on Optimism, it will offer additional rewards in the form of OP tokens airdropped weekly while maintaining the crucial feature of Senior tranches — coverage of funds.
Leveraging the composability of the product suite, the RWA BY vault won’t have any performance fees applied for early LPs.
Additionally, for the initial liquidity formation phase period, Idle and Clearpool will incentivize the yield offered with weekly OP airdrops based on the following thresholds:
The launch campaign will last at least 1 month. The fee waiving and the incentives distribution can be extended beyond this period.
Useful links
- 👉 RWA Best Yield: app.idle.finance/#/earn/best-yield/0x9Ebcb025949FFB5A77ff6cCC142e0De649801697
- 🔗 Main contract address: 0x9Ebcb025949FFB5A77ff6cCC142e0De649801697.
Ready to take your DeFi journey to the next level? Don’t miss out on the opportunity to be the first to deposit into the new RWA pool and unlock double-digit returns on stablecoin lending, the inherent fund coverage provided by Senior Tranches on top of zero performance fees, and weekly OP token rewards.
About Idle DAO
Idle DAO is an on-chain organization that empowers the DeFi credit market with robust yield automation and hedging instruments, facilitating its expansion and establishing a foundation for sustainable financial ecosystems via a more efficient and risk-adjusted capital allocation.
At the heart of Idle product design, there is a much broader thesis on the shifting DeFi lending market. It is formed on the core belief that, over the coming years, the global debt activity will move on-chain, making every transaction and loan programmable and auditable — as the world’s debt moves on-chain, liquidity providers will have the essential need to manage their exposure to it.
