1/ Looking for decent yields on your stables? Look no further;
Even in the depths of bear, there are some good yields out there.
Here's a short thread on @SturdyFinance and how they offer what they currently do.
Even in the depths of bear, there are some good yields out there.
Here's a short thread on @SturdyFinance and how they offer what they currently do.
2/ Disclaimer: Sturdy isn't new - I actually remember seeing this when it just launched in ~Nov 2021. I never got around to researching it.
By some stroke of luck, today @pgpsam (the founder) followed me and I got curious about it
So, I decided to make a short thread!
By some stroke of luck, today @pgpsam (the founder) followed me and I got curious about it
So, I decided to make a short thread!
3/ Sturdy is simply a borrowing & lending protocol, offering overcollateralized loans.
The core difference? It's interest-free loans while touting high stablecoin yields. It's 10th in the list of stablecoin farms with >1m TVL
As always, let's look at the source of yields:
The core difference? It's interest-free loans while touting high stablecoin yields. It's 10th in the list of stablecoin farms with >1m TVL
As always, let's look at the source of yields:
4/ Lenders deposit assets to earn yield on
Borrowers overcollateralize to borrow.
Under the hood, the borrower's collateral is converted to interest-bearing token using protocols like Yearn or Lido.
The yield is then distributed to lenders - and borrowers pay back the same.
Borrowers overcollateralize to borrow.
Under the hood, the borrower's collateral is converted to interest-bearing token using protocols like Yearn or Lido.
The yield is then distributed to lenders - and borrowers pay back the same.
5/ Sturdy aims to solve the problem of interest rates on overcollateralized loans in DeFi, while offering stable yields
A difficult problem to solve, but so far Sturdy has been going strong. Actually impressive, with over $23M in TVL
A difficult problem to solve, but so far Sturdy has been going strong. Actually impressive, with over $23M in TVL
6/ Risks
The biggest issue I see is how Sturdy generates their yield off collateral - for example, ETH deposited by borrowers is converted to stETH
A depeg in stETH combined with an immediate rush to the gates by borrowers could see bad debt rack up.
The biggest issue I see is how Sturdy generates their yield off collateral - for example, ETH deposited by borrowers is converted to stETH
A depeg in stETH combined with an immediate rush to the gates by borrowers could see bad debt rack up.
7/ But that's unlikely. The more pertinent case would be to focus on the smart contract security of the platforms that Sturdy works with
To mitigate this, Sturdy does seem to have a risk management framework.
Sturdy itself is audited by Certik and Code4rena.
To mitigate this, Sturdy does seem to have a risk management framework.
Sturdy itself is audited by Certik and Code4rena.
8/ All in all, an interesting protocol!
If you enjoyed this content, you'll love my newsletter:
0xkyle.substack.com
If you enjoyed this content, you'll love my newsletter:
0xkyle.substack.com
9/ And lastly, follow me @0xkyle__ for more.
Like/Retweet the first tweet if I helped you to find a place to park your stables for the time being:
Like/Retweet the first tweet if I helped you to find a place to park your stables for the time being:
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