YIELD App is a custodial app that allows users to earn up to 17% APY for YLD token holders on a variety of cryptocurrency assets.
There are a few notable aspects of YIELD App’s value proposition:
- It’s custodial but offers exposure to DeFi and other digital asset investment strategies.
- It doesn’t charge gas fees. Most DeFi yields succumb to high gas fees.
- It pays interest daily.
Users can earn up to a whopping 17% when maxing out the YLD loyalty and rewards program, which we’ll get into below.
YIELD App currently supports four assets (USDT, USDC, ETH and BTC) for earning APY. Its native YLD token is automatically staked when held on the platform to earn additional rewards and provide access to higher tiers.
“When we launched YIELD App it was with the express intention to open up DeFi to make the high yielding opportunities in this sector available to everyone,” says Tim Frost CEO of YIELD App. “We are pleased to say that we are succeeding on that mission, with close to 60,000 users now enjoying our platform across the world. In the future, we expect DeFi and the broader digital asset wealth management ecosystem to continue to broaden its user base, particularly in the developing world where products and services such as our own are most valuable.”
Rewards are distributed every 24 hours and can be redeemed at any moment. They are not automatically added or compounded though, instead if you want to reinvest your rewards then you must reinvest them inside your account. The company plans to add auto-compounding in the future.
The YLD rewards earned on your assets are stored in your portfolio while the YLD you earn on your staked YLD (wallet balance) will only automatically compound and accrue in your YLD wallet.
YIELD App’s minimum investments are set at 0.03 BTC, 0.1 ETH, and 100 USDC/USDT, respectively.
How Does YIELD App Work?
YIELD App is a digital asset wealth management platform that targets a minimum rate of return for our users.
YIELD App claims to seek the highest risk-adjusted rate of return within the cryptocurrency financial ecosystem through a diversified portfolio that is designed to minimize volatility.
The portfolio team aggregates all user funds and invests them across various crypto-based investment strategies and DeFi protocols. YIELD App aims to reduce the capital required as well as the transaction expenses, complexities, and time cost an individual would face trading on their own.
According to the site, YIELD App curates “bespoke opportunities in partnership with industry-leading quant funds, miners, market makers, and other proven DeFi investment managers.”
YIELD App uses its own automated and proprietary portfolio allocation tools, research, smart contract auditors, and approved counterparties to deploy and manage the assets it manages for users.
“We run an actively managed portfolio that is overseen by a team of experts in decentralized and centralized traditional finance,” adds Frost. “We focus on highly liquid investment opportunities that are low volatility and, most importantly, sustainable. We recently hired a new Chief Investment Officer, Lucas Kiely, who brings a wealth of experience from top tier firms such as UBS and Credit Suisse and who will be helping to strengthen our fund strategy further.”
Although the baseline passive income APY that YIELD App offers for cryptocurrencies like BTC, ETH, and USDC is above-average, the value proposition drastically increases when combined with its utility reward token, YLD.
YLD holders can scale their Tier level with the number of tokens held, potentially adding an additional 7% APY on the base asset and 10% YLD on YLD when holding 20,000 YLD tokens.
Frost explains: “Owning the YLD token is a way for our users to boost their returns up to a maximum of 17% APY. We have a Tier system, which means the more YLD users hold in their wallets, the more they earn. For example, the base APY on stablecoins (USDT and USDC) is 11%, but Tier 5 users that hold more than 20,000 YLD earn a further 6% in YLD on the base asset, plus a further 10% on the YLD they hold, also paid in YLD.
“On top of this, users get rewarded for supporting our ecosystem via additional rewards on the YLD portion of their portfolio. Last but not least, it allows users to participate in the growth of the token’s price as the YIELD App grows and expands. We make it really worthwhile to invest in our token.”
YIELD App’s documentation states that the company frequently adjusts rates both up and down in line with market conditions in order to ensure the sustainability of its model.
The company also supports the stability of the YLD token by periodically purchasing YLD tokens on the open market. This can be viewed here: https://etherscan.io/token/0xf94b5c5651c888d928439ab6514b93944eee6f48?a=0x1a11848434cafa84a676e70459015407ec15b542
YIELD App publishes company performance and other relevant metrics bi-weekly. In addition to the total number of assets on the platform, it also publishes treasury rebalancing addresses (where the company buys back its YLD on the open market) and the total number of tokens purchased.
What are the Risks?
- Rise and fall of the U.S. Dollar. Many DeFi instruments are stablecoin-backed, which are based on the US Dollar. YIELD App structures its positions as dollar-neutral (for stablecoin pools) and asset-neutral for others.
- The DeFi industry is notorious for its intense volatility, largely due to the space’s infancy and the overarching volatility of cryptocurrency assets. YIELD App’s multi-strategy approach aims to mitigate the volatility with a diversified portfolio.
- Sharp and sudden market crashes and “Black Swan” level events.
Justin Wright, CFO and COO of YIELD App, says: “Unfortunately, there remains the ever-present risk of hacks or exploits in DeFi, where a canny individual is able to take advantage of a weakness in the armor of a smart contract (through which all DeFi protocols are run) and drain the liquidity pool of a protocol.”.
“Naturally, we are aware of this and we are taking all possible steps to reduce the risks to our users. We have best-in-class technology and staff limiting such risks. In addition, we only deploy funds into a hand-picked selection of well-proven protocols on which we have undertaken forensic due diligence and we make an emphasis on diversifying.”
How Does YIELD App Make Your Money?
YIELD App deploys several investment strategies across the digital asset universe, among others in the decentralized finance (DeFi) ecosystem.
The company is unique in that it undertakes active portfolio management, whereas most cryptocurrency interest account platforms tend to rely on automated lending mechanisms. YIELD App aims to combine risk mitigation, social intelligence and analytics, smart contract auditing, and batched transactions with full technical and business due diligence.
Wright adds: “Our portfolio strategy includes comprehensive investment risk mitigation, while our platform is protected to the greatest extent possible against breaches using a raft of security measures. YIELD App is constantly monitoring and evaluating the most profitable market-neutral strategies across the DeFi ecosystem, including liquidity mining, arbitrage, liquidations, margin and collateralized lending, with other income-producing strategies. We deploy funds in curated liquidity pools that meet our strict risk and security standards. We also use a highly sophisticated risk management process, which allows us to achieve an optimal risk/reward ratio.”
Diversification and active portfolio management seem to be the staples of YIELD App’s management strategy.
“YIELD App invests in large, curated liquidity pools where our assets are a small part of the total. Within these, we diversify to spread out the risk. On top of this, we have an active investment team of specialists monitoring our positions 24/7. This is backed up by automated triggers that will automatically move funds into safe-haven assets during large trading events before the larger market can take action,” says Wright.
The Team
YIELD App has a globally distributed team of over 40 staff.
Many, including CFO and COO Justin Wright, and Chief Investment Officer Lucas Kiely, come from traditional financial backgrounds, bringing experience in financial technology, investment and banking.
YIELD App’s growth and marketing team includes former financial journalists, creative designers and crypto-native digital marketers. Chief Growth Officer Jan Standberg and Chief Marketing Officer Adrien Geneste have a background in crypto and digital marketing, having helped to steer crypto company Paxful to success.
CEO Tim Frost has a background in fintech and financial start-up businesses. Frost also spent a decade playing professional basketball around the world.
Final Thoughts: Is the YIELD App Legit?
YIELD App is a centralized way in which to interact with the world of decentralized finance. Users deposit cryptocurrency, which is then managed by the platform’s team of in-house fund managers, who in turn explore various ways to generate a yield in the cryptocurrency ecosystem.
“As financial regulators around the world are often at pains to point out, past performance is no guarantee of future performance and should not be used as an indicator of future returns,” says Frost.
YIELD App partners (source: YIELD App website)
“Within our own strategy, we focus heavily on finding low volatility, sustainable opportunities that can deliver the high yields our users have come to expect from us. Our portfolio team adopts a diversified approach that ensures assets are managed with efficiency and stability.”
The project is still largely in its nascent stages, but as one of the first-of-its-kind DeFi fund providers, it’s worth paying attention to.
Frost concludes: “At the moment, YIELD App is of course much smaller than either BlockFi or Celsius, however, this makes us nimble. We provide a bridge between the high-yielding worlds of DeFi that, typically, only very experienced investors with time on their hands can access, and these more centralized services. This means higher rates of return with less friction for our users.”
YIELD App is open to all users globally, excluding a few dozen countries such as the United States. The team is currently focusing its expansion efforts on developing countries and regions including Asia and South America.
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