Perpetual Yield Tranches

What are Idle Perpetual Yield Tranches

In the financial world, a tranche represents a product split that carries specific features like risk, yields, duration. They are often arranged together to create pools of diversified products or a basket of investments with similar characteristics (risk-return related).
Based on this concept, Idle launched its own tranches primitive: Idle Perpetual Yield Tranches.
Each tranched asset has its own yield source, with two investment profiles (Senior and Junior). Taking as an example the DAI tranche based on the IdleDAI Best-Yield pool, DAI funds deposited into the Senior and Junior class of that Idle-based product are aggregated into a single pool and then deployed into IdleDAI Best-Yield strategy.
Users can decide the strategy according to their risk profile: they can deposit funds into two different tranches (Senior or Junior) in exchange for a token indicating their claim.
Tranches allow users to enjoy DeFi yields with built-in protection on deposits by holding the Senior class, and leverage yield exposure with Junior one.
Last modified 28d ago
Copy link