In the highly volatile cryptocurrency market, investors focus not only on capturing opportunities for rapid wealth growth during bull markets but also place high importance on effective drawdown control and prudent capital management. Even experienced investors can suffer significant losses during periods of high market volatility. Therefore, during uncertain "sideways markets," understanding crypto-native stable yield becomes particularly crucial.
CEX Flexible/Fixed-Term Savings: Easy to Use, Low Yields While the DeFi/CeFi industry is flourishing, statistics about the stable yield market remain relatively limited. This may be primarily because such products often have certain yield caps, and to avoid yield dilution, related information sharing tends to be minimal, and tricky—— exchanges often offer bonus rates for the first $500-$1000 deposited, to make the yield numbers looks better.
Taking Binance as an example, according to official data, during the recent bull market, the average 30-day APR for flexible USDT savings was 9%, while the 21-day fixed deposit APR was 4%. During bear markets, yields are even lower - for instance, in April 2020, the flexible USDT average expected annualized yield was only 1.56%.
Similarly, OKX exchange offers comparable flexible and fixed-term yield products. In the current bull market, their Simple Earn flexible USDT yield rate is 4%. During bear markets, such as April 2020, the average expected annualized yield for flexible products was approximately 1.20%.
DeFi Stablecoin Yield Projects: More Diverse Choices, Greater Possibilities
In the current DeFi market, numerous projects offer stablecoin yield opportunities. Compared to CEX flexible deposits, DeFi projects typically offer higher yields but come with increased security risks, especially during extreme market conditions. Established DeFi institutions like MakerDAO and AAVE have demonstrated relative stability in this area. MakerDAO's DAI has achieved an average APY of 7.7% year-to-date, with a 30-day APY of 9.26%. AAVE's stablecoin yields for USDT and USDC have averaged 6.28% and 7.06% respectively year-to-date, with recent 30-day APYs of 9.44% and 11.24%.
Market-Neutral Yield: Outperform
In this cycle, Ethena has emerged as a phenomenon in DeFi, with its token's circulating market cap once exceeding $3.4 billion (corresponding to an FDV over $17.7 billion), demonstrating high market interest in new-type stablecoin yield projects. Although Ethena generates significant revenue through staked ETH yields, derivatives hedging arbitrage funding rates, basis income, and financial management returns, its current market valuation may be excessive, potentially leading to diminishing returns or even potential losses for regular participants. In this context, investors might consider similar but earlier-stage products like ShieldLayer, which recently announced its testnet launch.
While ShieldLayer hasn't reached Ethena's market scale and recognition, this suggests higher potential returns and growth opportunities for early participants. Unlike Ethena, ShieldLayer employs unique carry yields and automated high-frequency strategies, achieving stable performance with a 28% APY over past 7 years while maintaining maximum drawdowns below 1%, demonstrating exceptional risk control. Compared to sUSDe holders' average APY of 17.6% since February 2024, this represents an attractive stable yield. Moreover, Shield Layer's current valuation at just 1/500th of Ethena's offers an compelling opportunity for early participants —— the community will be able to obtain early tokens. Importantly, Shield Layer plans to airdrop tokens to early participants, further enhancing investment appeal and potential returns.
In conclusion, stable yield products play an indispensable role in cryptocurrency investment portfolios. Whether through CEX flexible and fixed-term products or DeFi stablecoin yield projects, investors can find suitable investment methods to achieve more rational capital allocation and risk management. Through scientific investment strategies and continuous market observation, investors can find their own path to steady returns in the cryptocurrency market.