Ethereum Yield

Intelligent ETH Exposure with Automated Yield Optimization

The ETH Yield Vaults (ETHy) are designed for investors seeking automated, high-performance ETH yield strategies. These dynamic vaults strategically allocates liquidity into long ETH positions, maximizing rewards while optimizing for risk-adjusted returns.

How the Strategy Works

Toros deploys ETH yield strategies using two distinct structures, each tailored for different market conditions and risk preferences:

Asset Neutral LPing

In this structure, the vault allocates liquidity into ETH-pegged LP pairs, such as WETH and stETH, directly benefiting from ETH price movements while earning additional liquidity provider (LP) rewards.

Example: At launch, the ETH Yield Vault fully allocated liquidity to the wstETH/WETH LP pair on Velodrome, leveraging highly incentivized LP rewards.

Returns are highly correlated to ETH price, with compounded trading fees and protocol incentives.

Delta Neutral LPing

The second structure is when the vault deposits ETH as collateral on Aave and borrows against it, creating a delta-neutral structure by LPing the borrowed asset into a neutral incentivized pair. For example:

• WETH deposited as collateral into Aave

• USDC is borrowed against WETH

• USDC and WETH are LPed on WETH/USDC pair on Aerodrome for increased yield.

This strategy is delta-neutral on ETH, performing correlated to the ETH price in addition to the yields generated from the ETH/USDC incentives and fees.