Yield Protocol

How does investment work?

In order to start investing, a personal contract should be created. Personal Contract contains all the needed functionality to proceed with investment (stake, provide liquidity, etc.).
Personal Contract is created once for each client. While creating the personal contract, a client has an opportunity to send the desired quantity of Ether. Also, the client can mark the amount of Ether he would like to transfer to the Personal Strategist account. Instead of Ether client can provide the ERC-20 address of the desired token (Yield protocol is using Uniswap for exchange in such case).
If the client used the service before - the personal contract already exists, so a user can directly transfer coins or tokens to the Personal Contract when needed.
For each personal contract, Personal Strategist is being created. Personal strategist is assisting the client with all investment actions. It's looking for the best available pool and makes a stake.
When the user is transferring the coins/tokens to a personal contract he can decide on the amount that should be transferred to the Personal Contract and to the Personal Strategist. Client needs to pay attention to the Personal Strategist balance and charge it once needed as the transaction fee is being charged for each stake, restake.

Investment logic

For example, a client decided to put 10 ETH into his personal contract.
  1. 1.
    The client transfers Ether to a personal contract.
  2. 2.
    The Strategy Deployer receives a notification about it and decides where to invest this amount.
  3. 3.
    Personal strategist calls stake function.
The following actions are realized in smart contracts:
  1. 1.
    Exchange cryptocurrency provided by the client into tokens
  2. 2.
    Grant the allowance to work with a liquidity pool
  3. 3.
    Add liquidity
  4. 4.
    Receive LP tokens
  5. 5.
    Wrap LP tokens in Vault (optional)
  6. 6.
    Make a stake
Once there is a better liquidity pool available (for example, with a higher APY) Personal Strategist is making restake to the better pool.
Reward from the liquidity pools is being collected automatically once restake or unstake action is performed. The reward is being stored on the personal contract.
All of the investment processes do not require actions from the client side. Client deciding what amount to invest and then smart contracts of Yield protocol perform all actions needed 24/7 on client's behalf.
Last modified 1yr ago