馃攧 Yearn Launches Katana yvUSDC Compounder Strategy
馃攧 Yearn Launches Katana yvUSDC Compounder Strategy
馃攧 New Katana Strategy Deployed
Yearn has introduced a new Katana yvUSDC Compounder strategy as part of its yvUSD vault allocation.
How it works:
- Deposits into the USDC Yearn vault on Katana
- Reinvests KAT rewards alongside native vault yield
- Underlying vault lends to Morpho markets curated by Yearn and Gauntlet
- Also deploys to SushiSwap LP pools managed by Steer Protocol
Background: Katana is a new EVM layer 2 incubated by Polygon and GSR, featuring an innovative incentive mechanism that directs token emissions and bridged asset yield toward DeFi applications. Yearn, Morpho, and SushiSwap are launch partners.
This strategy represents a return to normal operations after funds were temporarily deployed to Sky Ecosystem USDS staking during a recent crisis.
The Katana yvUSDC compounder is a simple, throwback strategy. It deposits into the USDC Yearn vault on Katana and reinvests the KAT rewards alongside the native yield earned by the vault. The underlying vault lends to Morpho markets curated by Yearn and @gauntlet_xyz, and
Katana is a new EVM layer 2 with an innovative incentive and liquidity mechanism that directs token emissions and the yield earned on bridged assets toward DeFi applications onchain. It was incubated by @0xPolygon and @GSR_io, with Yearn, @Morpho, and @SushiSwap as launch
Welcome to another edition of: Meet the Strategies of yvUSD! This is an ongoing series where we introduce the different strategies used in yvUSD, how they work, and why they are used. This week we focus on the @Katana yvUSDC Compounder.
During the crisis, the loopers were unwound and funds were deployed to @SkyEcosystem USDS staking strategies. Now that things are getting back to normal, yvUSD is being reallocated into new strategies, one of which is the Katana yvUSDC Compounder.
Katana Strategy Uses Native ZK Bridge, Avoids Third-Party Risk
A new strategy for bridging between Mainnet and Katana relies exclusively on Katana's native ZK bridge, deliberately avoiding third-party solutions like LayerZero. **Key Decision:** - Strategy avoids additional trust assumptions by using only native infrastructure - Reference made to past bridge failures as justification **About Katana:** - Productive Layer 2 where assets earn yield immediately upon bridging - Chain-Owned Liquidity (CoL) converts sequencer fees into permanent liquidity reserves - Features curated ecosystem with Sushi, Morpho, and Vertex - EVM-compatible ZK-rollup, ranked top three for TVL growth in 2025
yvUSD Emerges Unscathed from rsETH Hack Fallout
Following the rsETH hack and its ripple effects across DeFi platforms including Aave, Yearn's yvUSD successfully avoided losses through effective deleveraging. **Key Points:** - yvUSD maintained zero losses despite widespread DeFi disruption - Yearn vaults with Aave WETH exposure were fully unwound before impact - Kelp DAO contributed 2,000 ETH from treasury to DeFi United recovery effort - Recovery plan developed in coordination with Aave and multiple DeFi partners The incident demonstrated the importance of rapid response protocols in DeFi. Yearn's monitoring systems and quick action protected user funds during a period of significant market stress. Final recovery instructions for affected users are forthcoming.
Yearn Finance Activates Revenue Distribution for YFI Stakers
Yearn Finance has begun distributing revenues to YFI token holders who stake their tokens. Users can stake through three methods: - **Direct veYFI staking** - Lock YFI tokens to receive veYFI and earn rewards - **Liquid locker protocols** - Stake through platforms like 1up, Cove, or StakeDAO - **Boosted vault deposits** - Earn enhanced yields on vault deposits **How rewards work:** Every two weeks, veYFI holders vote to direct dYFI rewards to specific vaults. Your reward rate depends on your veYFI balance: - Base rate: 10% of possible rewards (1x boost) with no veYFI - Maximum: 100% of rewards (10x boost) with sufficient veYFI Liquid lockers allow YFI holders to rent out their voting power to vault depositors. Depositors pay a small fee but receive significantly higher yields through borrowed boost power. Rewards are paid in dYFI, which can be converted to YFI or sold on the market. Vault rewards auto-compound, while dYFI rewards require manual claiming through the liquid locker interface. A [boost calculator](https://docs.yearn.fi/contributing/governance/veyfi-calculator) helps users determine optimal veYFI amounts for their deposits.
Yearn-Curated USDC Vault Earns A Rating on Morpho Platform
**Yearn's OEV-boosted USDC vault on Morpho has received an A rating**, joining highly-rated vaults from Stakehouse and Gauntlet. The vault utilizes **Oracle Extractable Value (OEV) technology** to recapture value that would otherwise be lost to MEV bots, redirecting it back to depositors as enhanced yield. **Key highlights:** - A-grade rating validates vault's risk management and performance - Part of Yearn's expanding curation services on Morpho - OEV-boosting technology provides sustainable yield enhancement - Previously surpassed $10M in deposits milestone Yearn continues to demonstrate its **best-in-class vault curation and monitoring capabilities** across the Morpho ecosystem, offering institutional-grade DeFi products with enhanced risk assessment.