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Products > Best Yield > Overview
Based on the initial set-up of the Best Yield (OG) strategy, aggregating and optimizing Aave and Compound lending markets, today there are two types of Best Yield strategies:
- 1.Senior Best Yield: aggregating the over-collateralized, top-tier lending protocols Aave, Compound and the Idle Senior Perpetual Yield Tranches maintaining a conservative risk profile while extending and improving the yield spectrum.
- 2.Junior Best Yield: aggregating multiple Idle Junior Perpetual Yield Tranches on a single asset as underlying to create a new tier of risk in Best Yield, allowing to automate an aggressive approach and offer significantly higher APYs.
The Best Yield strategies constantly monitor 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.
By analyzing supply rate functions across integrated platforms and total funds in the pool, the strategy is able to constantly rebalance capital across any number of protocols to earn the highest interest rate possible with very high precision.
When users deposit funds, they receive
idleTokensfrom Idle in exchange.
idleTokensare ERC-20 tokens that can be redeemed for their underlying assets at any time. As interest accrues to the assets supplied,
idleTokensare redeemable at an exchange rate (relative to the underlying asset) that constantly increases over time, based on the interest earned by the underlying asset.
Best Yield strategies maximise the current aggregated interest rate, 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 strategies are available on Ethereum and Polygon blockchains. Each network has a different basket of assets available in the pools.
- 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 other underlying governance tokens as a form of incentives (e.g. COMP or AAVE);
- For integrators, no need to stitch together disparate protocols or spend months integrating and updating yield functionality.