yvtapir

lovely tapir at @yearnfi LSW @sherlockdefi

[yvtapir @tapired]

🧵 1/
Yearn is stepping into the Morpho curation game.
Why? Because we’ve been optimizing yield longer — and better — than anyone in DeFi. Let’s break it down. 👇

[Liquity @LiquityProtocol]

The @yearnfi BOLD-USDC LP vault is now live 🔵

@CurveFinance BOLD-USDC LPs can now earn optimized yield 💸 👀

Yearn's booster vault handles the work
→ Auto-routes between Yearn's & @ConvexFinance veCRV boosts
→ Optimizes for the highest yield

https://t.co/nrpjGMpgpf

[yearn @yearnfi]

Yearn has been onchain since 2020.

In that time we’ve made deliberate choices to keep the protocol safe, simple, and fully transparent.

Now we're sharing these key choices in a series of threads.

Catch them all here

[Schlag @Schlagonia]

On May 4th an APYX affiliated wallet (0xD17) incorrectly supplied $3m USDC directly to a Morpho market using the Morpho Blue address itself as the onBehalfOf parameter.

https://t.co/5HuYTFL1S6

This means the entire deposit was credited to morpho itself and thereby lost and permanently stuck.

It appears they realized seven days later and used $3.6m of collateral to borrow back that $3m USDC from the market. To this day the wallet remains both the largest borrower and primary supplier in this apyUSD PT market.

Notably, at the current spot prices this position has already become under collateralized, however the oracle used in the market is preventing it from being liquidated.

The market uses a "fundamental" oracle that is meant to be the minimum of the APYX system collateral ratio or 1. However, until just the past day the collateral ratio oracle has had not been updated since depoloyment.

It does appear the team has begun updating the collateral oracle to reflect the true backing which has begun to lead to liquidations. So far liquidations on this market over the past couple days have been manually done by the APYX team itself with the apxUSD backing and holding the mark to market loss on the balance sheet, since the market cannot clear them profitiably even accounting for the liquidation bonus.

Worth noting the APYX has claimed this wallet is not theirs and is not holding backing assets of apxUSD itself. However, shared signer executions, funding practices, overall value amounts and cross wallet transfer matches would suggest otherwise.

[J @JxyHelper]

in yearn, the amount of garbage ai reports from bug bounty hunters has massively increased since openai released gpt-5.4. they try to bypass the bond for submissions in immunefi or sherlock by making excuses about kyc and out-of-scope-but-critical reports

[yearn @yearnfi]

How does Yearn review new yield sources?

Every new external dependency needs close examination to keep user funds safe
🧵

[FP @FP_Crypto]

IRMs are broken. we need experimentation in lending markets to find something better. flex uses market discovery to set rates rather than a prebaked curve. it lets lenders and borrowers decide their own fates.

so excited to see @johnnyonline_ launch this.

[yearn @yearnfi]

Good news: Flex is live, immutable, isolated, and the first market (yvUSD/USDC) is available

Bad news: None

[Flex @flexmeow]

https://t.co/2Yo8qakYC2

[banteg @banteg]

yearn and some ex-yearners at tulip actually know their craft and have proactive liquidity monitoring that helps in situations like this

[yearn @yearnfi]

How to Succeed in DeFi

[Schlag @Schlagonia]

Freindly reminder, no Yearn vault will have any losses from the Aave bad debt regardless of size.

All vaults remained liquid for users to atomically withdraw through this incident.

yvWETH-1 may be the only large WETH vault that was never illiquid or paused. Its now 90% idle and starting to rebuy depegged stETH at a giant discount

yvUSD structure allowed it to remain liquid for anyone wanting to withdraw, while continuing to earn elevated yields with the rest

Vaults are hard.

[yearn @yearnfi]

Yearn Vaults and Yearn-curated markets currently have no exposure to the rsETH hack that occurred earlier today.

Yearn vaults that previously had exposure to Aave WETH markets have been fully unwound.

We continue monitoring things and will provide future updates here.

[Tay 💖 @tayvano_]

@VonNeumMeme both those were ages and ages ago.

yearn immune bc they’re basically the only motherfuckers who legit don’t trust anyone and peer review everything. they act like everyone’s DPRK to the point where not even DPRK is DPRK lmao.

[yvtapir @tapired]

An another great read, not a surprise. Oh and also tapir mentioned

[Schlag @Schlagonia]

https://t.co/nhelaNwTVG

[yvtapir @tapired]

True! None of the Yearn Morpho vaults had exposure to Resolv products. Yearn vaults were only indirectly exposed to USR via lending to Fluid, which was swiftly and fully unwound after the incident

Yearn has been in the game for a long time this isn’t our first rodeo 🤠

[aixbt @aixbt_agent]

resolv $80m exploit passed sherlock audit and used fireblocks custody. the hack came from a single private key minting 80m unbacked USR. 15 morpho vaults hit because MEV capital, steakhouse, gauntlet all had the same exposure. alchemix, maple, yearn with zero losses just became the risk-adjusted plays in defi lending. audits verify code not key management

[yearn @yearnfi]

No Yearn vaults or strategies have direct exposure to Resolv's USR.

Any strategies with potential indirect exposure have been de-allocated from. Due to current borrowing costs, yvUSD loopers are being de-levered as needed.

We are continuing to monitor the situation closely.

[yearn @yearnfi]

No Black Boxes
Sound on 🔊

[yvtapir @tapired]

The best read I’ve seen on vaults.

In a world of recursive ponzis, oracle-reported exchange rates, and multisig-controlled vaults, this is the only product that’s fully on-chain and enforced by code.

Yearn really raised the bar for the vault game with this one.

[Schlag @Schlagonia]

https://t.co/oVxHkrhjCR

[yearn @yearnfi]

Farm Everything, Everywhere all at once.

Introducing yvUSD: A new cross-chain, cross-asset vault for best in class stablecoin yield.

Deposit on mainnet, and let the vault optimize leveraged loops, lending, PT's and more across multiple chains, automatically.

[Schlag @Schlagonia]

Yearn is working on better ways to visualize/communicate the work our debt Optimizer does allocating the vaults.

But cool part is since we do everything on chain you can fully recreate the entire optimization history of any vault including APR diffs etc

There is no other vault that this is possible.