Frequently Asked
Questions

Yield Basis is a new standard for liquidity provisioning that transforms market volatility into yield for liquidity providers. Instead of suffering impermanent loss when asset prices move, Yield Basis converts that volatility into a source of income.

The protocol achieves this through a novel market-making mechanism that pairs yield-bearing assets (such as wrapped Bitcoin or Ethereum) with crvUSD inside automated market maker pools. When traders swap against the pool and prices shift, the protocol rebalances automatically — generating fees and compounding returns for depositors rather than eroding their position value.

In practice, you deposit your BTC, WETH, or other supported assets into a Yield Basis market and choose between Trading Yield (earned directly from market activity) or Token Yield (earned through YB emissions). Both paths allow you to remain long on your asset while the protocol works to maximize your returns.

Getting started on Yield Basis is straightforward. Follow these steps:

1. Connect your wallet — Use MetaMask, WalletConnect, or any EVM-compatible wallet by clicking "Connect Wallet" in the top right corner of the app.

2. Browse available markets — The Earn page shows all active Yield Basis markets, including cbBTC, tBTC, WBTC, and WETH pools with their current TVL, Token APR, and Trading APY.

3. Choose your yield source — Each market offers two options: Trading Yield (FT APY) derived from market-making activity, or Token APR earned through YB token emissions.

4. Deposit your assets — Select the market and amount you wish to deposit. Your assets start earning immediately upon confirmation.

5. Monitor and manage — Track your positions on the My Markets tab, view analytics, and adjust your strategy at any time. For boosted returns, consider locking YB tokens to receive veYB and vote on gauge weights.

Traditional AMMs suffer from impermanent loss because when asset prices diverge from their initial ratio, the pool must rebalance — giving away more of the appreciating asset to traders at below-market prices.

Yield Basis fundamentally redesigns this mechanism. Rather than simply rebalancing with the pool's own assets, Yield Basis markets use the yield generated by the underlying yield-bearing assets to fund the rebalancing process. This means:

— Price moves in your favour: The protocol uses accrued yield to buy back your asset at lower prices before the price recovered, effectively compounding your position.

— Price moves against you: Instead of realising a loss, the yield cushions the drawdown, and the pool's position improves as it accumulates the cheaper asset.

The result is that market volatility — historically the enemy of liquidity providers — becomes the primary driver of yield on Yield Basis. Higher volatility means more trading activity, more fees collected, and faster compounding.

Yield Basis offers two distinct yield sources, and you choose one per deposit:

Trading Yield (FT APY — Fundamental Trading APY)
This is the annualised return generated directly by the pool's market-making activity. When the pool rebalances in response to price movements and trader swaps, it realises gains that are passed to you as the depositor. The 30-day figure shown in the app reflects recent pool performance. This yield is paid in the deposited asset (e.g. WETH or BTC), so your holdings grow in nominal token terms.

Token APR
This is the yield earned through YB token emissions. Yield Basis allocates YB tokens to liquidity providers according to gauge weights voted on by veYB holders. If you hold and lock YB, you can vote to direct more emissions to markets you are deposited in, further increasing your Token APR. Token APR is expressed as an annualised percentage of your deposit value and is paid in $YB tokens.

Neither option is strictly superior — the best choice depends on your view of $YB price, your time horizon, and current market conditions. Many users monitor both figures on the Earn page before deciding.

$YB is the native governance and incentive token of the Yield Basis protocol. It serves two primary functions:

1. Incentivisation — $YB tokens are distributed as Token APR to liquidity providers who deposit into Yield Basis markets. This bootstraps liquidity and rewards early participants in the protocol's growth.

2. Governance — $YB holders can lock their tokens to receive veYB (vote-escrowed YB). The longer you lock, the more veYB you receive. veYB grants you:

— Voting power on gauge weights, which determines how $YB emissions are distributed across different markets. If you vote for a market you are deposited in, you can increase the Token APR available to that pool.

— Boosted yields on your own deposits, proportional to your veYB balance relative to your share of pool liquidity.

— Protocol governance rights on proposals submitted through the Govern section of the Yield Basis app.

The veYB model aligns long-term token holders with the protocol's success, as locking $YB removes selling pressure and incentivises participants who are genuinely committed to Yield Basis's growth.

Yield Basis currently operates on Ethereum mainnet and supports the following yield markets:

— cbBTC / crvUSD — Coinbase Wrapped Bitcoin, the largest market by TVL on Yield Basis
— tBTC / crvUSD — Threshold Network's trust-minimised Bitcoin wrapper
— WBTC / crvUSD — Wrapped Bitcoin, the original and most widely held BTC wrapper
— WETH / crvUSD — Wrapped Ether, providing yield on Ethereum holdings

The protocol is built on top of Curve Finance infrastructure, leveraging Curve's battle-tested AMM contracts and crvUSD as the stable counterpart in each market. This design inherits Curve's security properties and deep liquidity ecosystem.

Additional markets and chain deployments may be added through governance votes by veYB holders. Follow @yieldbasis on X and join the community forum to stay updated on new market proposals.

Yield Basis is built with security as a priority, leveraging Curve Finance's audited smart contract infrastructure. However, as with all DeFi protocols, participating in Yield Basis carries risks you should understand before depositing:

Smart Contract Risk — Despite audits, undiscovered vulnerabilities in the Yield Basis or Curve codebase could result in loss of funds. Never deposit more than you can afford to lose.

Oracle Risk — Yield Basis markets rely on price feeds to determine rebalancing. In extreme market conditions, oracle failures or manipulation could affect pool performance.

Liquidity Risk — Withdrawals from filled capacity markets may require waiting for capacity to free up, or accepting a fee depending on market conditions at the time.

Token Price Risk — If you choose Token APR, your YB earnings are subject to $YB market price fluctuations. A decline in $YB value could reduce the USD-denominated value of your rewards.

Market Capacity Risk — Markets with 100% capacity shown as FILLED cannot accept new deposits until existing positions are withdrawn. Always check capacity before attempting to deposit.

We recommend reading the Yield Basis documentation in full and consulting a financial advisor before participating.

The Yield Basis ecosystem has a growing set of resources to help you learn, engage, and stay up to date:

Official Documentation — docs.yieldbasis.com covers how the protocol works, technical architecture, smart contract addresses, and user guides for every feature of the app.

Community Forum — forum.yieldbasis.com is where governance proposals, feature discussions, and community debates take place. veYB holders participate in formal votes here.

Twitter / X — Follow @yieldbasis for protocol announcements, market updates, and ecosystem news.

Telegram — Join the Yield Basis community chat to connect with other users and the team.

Discord — discord.gg/yieldbasis for real-time support, technical discussion, and community events.

GitHub — github.com/yield-basis for open-source contract code and development updates.

You can also explore the About Yield Basis page on this site for a deeper overview of the protocol's mission and team.