Products > Best Yield > Overview
The Best Yield strategy constantly monitors interest rates on various DeFi yield sources to ensure the current allocation is yielding the best aggregate interest rate available on the market.
Users' funds are pooled together and programmatically deposited into one or more of the available lending protocols.
When a user deposits funds, an equivalent amount (value-wise) of strategy tokens (
idleTokens) is minted to his or her account. When a user withdraws funds from the strategy, the equivalent amount of value in the strategy token is burned from his or her account.
As soon as the user deposits, he or she starts earning yield. Essentially,
idleTokensholdings and yield are split up across the pool token holders proportionally to their balances. For example, users will get IdleDAI if they deposit into the DAI BY pool.
Best Yield strategy maximises the current aggregated interest rate, this can be modelled as follows:
nis the number of lending protocols used,
x_iis the amount (in underlying) allocated in the protocol
nextRate(x_i)is a function that returns the new APR for protocol
x_iamount of underlying and is
Currently, the Best Yield strategy is available on Ethereum and Polygon blockchains. Each network has a different basket of assets available in the pools.
Currently, there are two protocols integrated into the BY strategy:
- A superior optimisation algorithm for automatic management of users' funds;
- Gas fees savings for funds rebalance (which the user would have to pay to deposit funds/interact from one platform to another);
- By depositing into BY pools users can get several other underlying governance tokens (e.g. COMP or AAVE);
- For integrators, no need to stitch together disparate protocols or spend months integrating and updating yield functionality.