YieldNest Explains Yield Looping Strategy Between Real-World Assets and DeFi Borrowing

YieldNest has announced a partnership with Willow Protocol to develop a cryptographically verifiable analytics dashboard. This collaboration builds on YieldNest's recent integration efforts, following their October 2024 partnership with API Verse for blockchain analytics and API access. The new dashboard will leverage cryptographic verification to provide transparent, trustworthy analytics data for users of the liquid restaking protocol.

**ynRWAx enables a new DeFi primitive: looping real-world asset yield** YieldNest's ynRWAx token is designed specifically for leverage looping—a strategy where users borrow against yield-bearing collateral to amplify returns. Unlike most RWA tokens, ynRWAx offers: - **Stable collateral** backed by Australian mortgage-secured credit - **~11% base APY** from real-world lending - **Deep borrow markets** on Morpho and Euler - **ERC-4626 composability** for seamless DeFi integration **How it works:** Deposit ynRWAx as collateral → borrow USDC → buy more ynRWAx → repeat. Each cycle stacks exposure to the 11% yield while paying ~5% borrow costs, creating a positive spread. Contango now automates the entire loop into one transaction using flash loans, making the process significantly simpler. **The setup includes:** - Isolated risk pools on Morpho - One-click looping via Euler's Multiply feature - Additional yield through Merkl and Brevis incentives - Yield tokenization options on Pendle and Spectra **Key risks:** liquidation if ynRWAx/USDC ratio drops, variable borrow rates, and redemption constraints (maturity: Oct 14, 2026). This wasn't possible until recently. Now it's becoming a core DeFi building block. [Full looping guide](https://medium.com/@yieldnest/ynrwax-looping-capture-the-spread-between-real-world-yield-and-defi-borrow-rates-269de9395cc9)

**Euler V2's multiply feature streamlines leveraged yield farming** by automating the entire looping process into a single transaction. **Key features:** - Uses flash loans to execute borrowing, swapping, and resupplying automatically - Vault-to-vault LTV settings optimized for ynRWA - One-click execution eliminates manual multi-step processes This innovation builds on similar functionality previously introduced by [Morpho](https://app.morpho.org/ethereum/borrow), which partnered with Velora DEX to enable position looping across Ethereum, Base, Unichain, and Polygon networks.

**YieldNest has launched a new delegator on Cap that connects restaked ETH to real-world mortgage credit.** **How it works:** - ETH restakers provide coverage on Cap - YieldNest operators borrow USDC - USDC flows into $ynRWAx (mortgage-backed credit) - ynRWAx earns ~11% APY from Australian real estate mortgages - Yield returns to restakers at 36% APY The system bridges on-chain liquidity with real-world assets, specifically top-tier Australian real estate. This marks a shift toward using restaked assets as collateral for real-world credit markets. The delegator is built in partnership with Cap and Agra, enabling stable, real-time liquidity for private credit deals. Restakers can now earn yield from both network security and mortgage-secured credit simultaneously. [Access the YieldNest Delegator](http://cap.app/delegators/yield-nest)