Developers > Best Yield > Architecture

The main smart contracts used by Idle are the following:

  • IdleToken holds pooled funds of all users for a specific asset and issues ERC20 shares of the pool (IdleTokens) for each deposit.

  • IdleCompound, IdleAave wrappers contract used by IdleToken to interact with the lending protocols implemented

BY strategies are also ERC-4626 compliant! Deployed wrappers can be found here.

Idle Rebalancer automatically analyses supply rate functions across integrated protocols and total funds in the pool to constantly rebalance capital across any number of protocols to earn the highest interest rate possible with very high precision. When a new allocation can improve the aggregated APY of an IdleTokens, the Rebalancer submits new allocations to the contract.

New allocations are not enforced, but when they are submitted, any user can trigger a rebalance.

During the rebalance process, IdleToken contracts check if the new allocation is different and eventually accept it. This triggers a rebalance which mints or redeem the pooled funds on different lending protocols via the dedicated wrappers (IdleCompound, IdleAave, ...).

If no rebalance is triggered after some time (currently every ~3h), an off-chain bot rebalances the pool for everyone.

All Idle strategies use the same set of smart contracts, but each allocation uses a different instance of those contracts.

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