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Stablecoin Yield Strategy Overview: Diverse Options and Risk Warnings for USDD, Canto, Velodrome, and More
Latest Updates on Stablecoin Yield Strategies: Diversified Choices and Risk Warnings
In the current environment where the US dollar index is high and risk assets are under pressure, holding dollar assets and earning returns has become a choice for many investors. It is worth noting that some leading decentralized finance ( DeFi ) projects are also actively seeking returns by utilizing idle dollar assets. For example, the recently passed MIP 81 proposal will allow transferring up to $1.6 billion of USDC to a certain custody service to earn an annualized return of 1.5%.
This article will explore the latest developments in several stablecoin yield strategies:
USDD+3Crv Strategy
USDD is a stablecoin managed by an organization. As of October 27, the issuance of USDD is 725 million, with collateral value of 2.23 billion USD and a collateralization rate of over 300%. Among them, the collateral amount of USDC alone has reached 990 million, significantly exceeding the issuance of USDD, indicating a lower risk factor.
A certain DEX platform shows that the annualized yield of the USDD+3Crv pool is 19.66%, while the APR of USDD+FRAXBP reaches 21.18%. The former includes four stablecoins: USDD, DAI, USDT, and USDC, while the latter includes three: USDD, FRAX, and USDC. When operating, users can first deposit supported stablecoins on the relevant pool page, and then stake the obtained LP tokens on the specified platform.
It is worth mentioning that in a certain public chain ecosystem, the application of USDD is more extensive. For example, the annualized yield of the USDD-USDT trading pair on a certain DeFi platform can reach as high as 41.9% (requiring locking and staking of platform tokens), while the annualized yield for USDD deposits on another lending platform is 9.52%.
Canto: USDT+NOTE Strategy
Canto is an EVM-compatible DeFi public chain with features such as DEX, lending, and stablecoin NOTE. Currently, the total locked value in the Canto ecosystem is approximately $100 million.
Canto's lending platform shows that the APR for NOTE/USDT LP is 32.14%, and the APR for NOTE/USDC LP is 29.47%. NOTE is a stablecoin minted through over-collateralization within the Canto ecosystem, and there will be no liquidation when the collateral is USDC and USDT. Currently, the price of NOTE is $1.04, and it is recommended to use a portion of USDT to collateralize and mint NOTE, then provide liquidity with the remaining USDT, and finally stake the LP tokens on the lending platform.
It is important to note that Canto's cross-chain operations are relatively complex. To enter, you need to cross from Ethereum to Canto and convert to Canto's ERC20 tokens; to exit, you must first convert to Canto's native coin, then use the Cosmos cross-chain bridge Gravity Bridge, and finally cross back to Ethereum.
Velodrome: sUSD+LUSD Strategy
Velodrome is a DEX on Optimism, currently with a TVL of 82 million dollars. sUSD and LUSD come from Synthetix and Liquity respectively, both of which are considered relatively safe.
The current APR for liquidity mining of the sUSD/LUSD trading pair in Velodrome is 16.12%.
Helio: HAY+BUSD Strategy
Helio Protocol is a liquidity staking and lending protocol on a public blockchain. Users can over-collateralize to borrow Helio's decentralized stablecoin HAY, and the staked native tokens will be used for liquidity staking.
A certain DEX has specially added a StableSwap exchange entry for HAY and BUSD on its Swap page. Currently, Helio's TVL is $92 million, with approximately $20 million staked in HAY/BUSD Stable LP.
Users can provide liquidity for the HAY/BUSD stablecoin trading pair in the DEX and then stake the LP tokens in Helio, currently showing an APR of 19.77%.
Wombat Exchange Ecosystem: Multi-Coin Strategy
Wombat Exchange is a stablecoin exchange DEX on a certain public chain, featuring low slippage, shared liquidity, and the ability to stake using a single token. It has a strong lineup of investors, including several well-known institutions and projects.
Currently, the Main Pool of Wombat shows that the median APRs for USDC, USDT, DAI, and BUSD are 11.44%, 11.14%, 10.85%, and 7.57% respectively. These figures include the effects of locking WOM and holding veWOM.
Similar applications have also emerged around Wombat, such as Wombex Finance and Magpie, where ordinary users may achieve higher returns by depositing through these applications.
Risk Warning
The overall risk of the cryptocurrency market is higher than that of traditional financial markets, with frequent security incidents. Investors should pay attention to diversifying risks, fully understand specific risk points before investing, and conduct their own research. This article will continue to update relevant strategy information.