Yields Of The Week

Welcome to the first edition of Yields of the Week, part of The Edge Newsletter! Each Friday, we'll spotlight the top DeFi yields across the crypto landscape, focusing on opportunities that are not just the highest APYs but also sustainable and unique opportunities. Whether you're new to DeFi or a seasoned degen, our goal is to help you navigate the yield farming space with confidence. Expect hands-on tutorials, expert strategies, and everything you need to master the digital asset space—starting with the best yields the market has to offer. Let’s dive into this week’s picks!

Special thanks to our sponsors who make it possible to provide FREE content like Yields Of The Week!

♦️ REDSTONE ORACLES | THE FASTEST GROWING ORACLE FOR DEFI

☀️ SUMMER.FI | THE BEST PLACE TO BORROW AND EARN IN DEFI

🧙‍♂️ MERLIN CHAIN | THE RISE OF BITCOIN'S LARGEST LAYER 2

🔥 FBTC | YOUR GATEWAY TO BITCOIN EARNINGS

🐡 PUFFER FINANCE | LIQUID RESTAKING FOR THE LITTLE FISH

Before we get started, this is never a recommendation or endorsement to buy any token(s) mentioned, and here’s a few risks to consider:

• Smart contract risk in any underlying protocols

• Pool size and liquidity depth

• Front-end spoof attack on an app frontend

• An economic design exploit

• Colluding signers on any multisig

• Systemic risk across DeFi, including stablecoin depegs

Stablecoin Yields

Morpho - It’s been hard to compete with Morpho lately on stable yield pools. Here’s the top ones for the past 7 days from Vaults.fyi:

Fluid - Fluid is a great spot to check for stablecoin yields because their lending markets typically host attractive lending yields for for USDC and USDT. At the time of writing this, lenders can earn 9.54% with USDC and 8.8% for USDT.

ETH/BTC yield

Instadapp Lite - The Instadapp team has demonstrated a robust history of managing assets worth billions of dollars over a five-year period without experiencing any security breaches or exploits. Their Lite vaults provide highly competitive risk-adjusted yields for Ethereum (ETH) and Bitcoin (BTC):

Pendle

Pendle - Pendle is an absolute treasure trove for yield and deserves its own category. You could write an entire weekly piece dedicated to mastering Pendle and guess what? They do, it’s called The Pendle Print. This is essential reading to know what’s happening weekly on Pendle, including some nice alpha for PT and YT strategies. One other mandatory follow is Pendle Intern on Twitter (X) as they drop lots of knowledge, including airdrop calculations and yield strategies.

When we think of Pendle, we break it down into two different buckets, depending on what you seek as a DeFi user:

1. Real Fixed Yield? (PTs)

2. Points Yield? (YTs)

The easiest way to get started with Pendle is go to their markets page and filter by BTC, ETH, Stables, Points or RWA. There’s something for almost everyone here:

For instance, right now all the major BTC pools are offering between 7-9% fixed yield for the next 75 days. Locking in that sort of yield on BTC is absurd.

Leverage Looping Yields

Looping can be a very effective leverage strategy to earn more yield, but one must be cautious to monitor borrowing rates, a necessary cost to generate such leveraged yields. It’s also important to know if you’re going after points or real yield when looping.

Contango - Contango is a protocol for trading on leverage via looping built on the liquidity of battle-tested DeFi protocols such as Aave, Compound, and Morpho. There’s two different interfaces when using Contango, Advanced vs Simplified. We prefer use the Simplified UI because it’s much easier to use and understand.

One of the most attractive yields this week is wstETH/ETH on Morpho. Looping this to max leverage of 12.72x would result in earning an estimated Max ROE of 40.38%.

Origami - Origami is another easy one-click app for looping (folding) to create a leverage position, but with automatic position management to avoid the threat of liquidation.

One of our favorite pools has been this sDAI 11x position. It’s been live for many weeks now and yields are holding stable around 16%:

That’s all for now, thanks for checking it out!

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