Yield Basis: Disrupting Defi & Bitcoin Yield

Yield Basis addresses the persistent issue of impermanent loss in automated market makers by utilizing a specialized vault structure that maintains a constant loan-to-value ratio. By borrowing crvUSD against collateralized assets like Bitcoin, the protocol effectively cancels out the square-root price function inherent in traditional AMMs, allowing liquidity providers to earn real yield from volatility rather than suffering from price divergence. This design, which builds upon lessons from Curve Finance’s VE tokenomics, separates liquidity providers into those seeking natural yield and those pursuing governance tokens. The protocol functions symbiotically with Curve Finance, driving volume and liquidity to crvUSD pools while generating revenue for both the Yield Basis and Curve DAOs. As the protocol scales, it aims to shift Bitcoin liquidity from centralized exchanges to on-chain environments, with future expansions planned for Ethereum and other ecosystems.