This piece is about how MetaVaults aim to solve some of the toughest frictions we’ve faced.

But before we get into what they unlock, it’s worth being honest about what hasn’t worked and how we’re approaching it now.

The Problem: Expiring Pools and UX Fatigue

Fixed-term pools gave us fantastic and powerful assets - Principal and Yield Tokens.

However, they come with a fundamental UX issue: every time a pool expires, it’s like rebooting your entire product.

Every new setup often requires fresh business development, liquidity bootstrapping, and coordination across teams - just to (re)ignite PT and YT trading.

And if you’re an LP? It can be tiresome as well. You have to manually pull funds, track expiries, and redeploy—again and again —while educating yourself about the new setup.

It’s becoming a full-time job, no?

This isn’t how the LP experience should work - especially when most are looking for passive exposure.

The Other Problem: Classic LP Tokens & Earnings Perception

Here’s another brutal reality: a lot of our LPs don’t know if they’re winning.

Yes - winning.

Why? Because the standard LP token structure doesn’t actually tell them much.

Even a slight swing in the price of the PT or interest-bearing token (yes, even stablecoin-related) can make a user’s position appear to be down in the App - while they’re not.

Meanwhile, they’re quietly collecting pool yield in the background—but often they can’t tell, because a swing masks the LP Token’s net earnings.

We’ve seen it firsthand - users panic-exiting pools they were actually in profit on.

That’s not their fault. It’s on us—and the system we built around standalone LP tokens.

One more thing before diving into MetaVaults

Not all the friction came from maturity structures. A big part of it originated from how the underlying infrastructure was initially built. Spectra’s previous AMM focused on permissionless access and maintaining liquidity within range, but it didn’t effectively concentrate liquidity.

This led to a common complaint: despite healthy pool TVL, users didn’t always get good quotes.

Improving our market’s efficiency remains a priority. We recently rolled out a major AMM upgrade that tackled some of these issues, and we’re continuing to iterate. Limit orders are in development, and additional improvements are planned following the launch of MetaVaults.

But even the best AMM can’t fix how users interact with expiring, fixed-term pools.

That’s where MetaVaults come in.

MetaVaults: A New LP Format That Removes Expiry Friction, Hides Yield Token Complexity, and Lets Curators Manage the Heavy Lifting Under the Hood

If you’ve seen Morpho’s curated vault design, this will sound familiar.

Users deposit once. A small, informed group—the curators—manage capital across connected pools, transparently and onchain.

That model works - it attracts users and capital more easily, and helps maintain traction while building a track record. And we’re not pretending we invented it—Morpho pioneered the curated vault meta, and they nailed it.

We’re following their lead, applying the same principle to the far more chaotic world of fixed-term markets.

MetaVaults introduce the perpetual LP experience to fixed-term markets

As a MetaVault LP, you deposit once. That’s it. No more jumping from pool to pool, no more setting calendar reminders to roll over your position.

MetaVaults introduce the curator role to the Spectra ecosystem - a dedicated operator who handles active reallocation, rollover timing, and all the expiry/new pool setup logic under the hood.

In return, you get a single, receipt-style token, just like you’d expect from Morpho. It represents your full position, and importantly, all the yield it’s earned over time.

This shift—from fragmented pool-by-pool setups to a unified, long-running vault—has a real compounding effect:

• LPs, the backbone of protocol liquidity, are more likely to stay engaged

• Pool yield becomes clearly visible, not buried behind classic LP token price swings

• Spectra strengthens its ability to retain long-term users and capital

And there’s one more piece—something that’s subtle but makes a huge difference in user experience: as a MetaVault LP, you don’t deal with Yield Tokens at all.

No more wondering why your deposit was split into two assets. No more trying to figure out what the YT is worth, or whether you should sell it, or convert it back to LP, and when.

All of that disappears for liquidity providers.

Stronger MetaVault Yield with YT yield → LP redirection

Behind the scenes, Yield Tokens (YTs) continue doing what they’re designed to do—accumulate yield.

However, in MetaVaults, instead of leaving the yield idle, the curator redirects it, converting the ongoing yield accrual of YT into more LP tokens.

This reinjection loop - Yield Token → LP Token - creates a compounding effect.

Over time, this can push MetaVaults above classic, standalone LP setups in terms of base rate returns. It’s a subtle mechanic, but one with a clear effect - positioning Spectra’s yield opportunities at the top of rankings of trackers such as DeFillama.

For Projects: One Vault. Always Live.

MetaVaults don’t just simplify things for LPs - they also reshape the experience for teams and protocols.

Today, every new pool maturity kicks off a new round of friction:

• A fresh link to circulate

• Another wave of user education

• A temporary drop in TVL as liquidity rotates out

• And yet another uphill push to rebuild momentum and have people trade again

It’s repetitive, high-effort, and doesn’t scale.

Teams work hard (Spectra internal bd efforts included) to build traction, only to watch it reset every few months when a pool expires.

And during that expiry window, there’s a real risk: idle or confused liquidity gets reallocated—sometimes to competing pools.

MetaVaults change that by giving curators and projects a single, permanent vault address. One place to route users. One front door for liquidity and communication.

No more scrambling to explain what changed or where to deposit next. Just one link - easy to integrate, easy to reshare, always live.

This also gives community messaging a chance to compound. When your vault doesn’t expire, your comms don’t either.

For Spectra Protocol: Supercharged Growth & Aligned Market Actors

One of the most important shifts MetaVaults bring isn’t just around UX. It’s the creation of a new business development layer inside the protocol, run by curators.

This curator layer amplifies Spectra’s BD efforts—expanding reach, deepening integrations, and compounding traction alongside the core team.

It also unlocks something new: curators shaping how and where Spectra’s core assets, like Principal Tokens, are integrated and adopted. And since many curators already operate within lending ecosystems like Morpho or Euler, they’re well-positioned to integrate PTs into those markets more efficiently.

Over time, this dynamic raises the quality bar. Curators looking to attract capital need to identify and create strong pools, align with protocols, and consistently optimize for performance. In doing so, they help grow Spectra’s TVL, deepen integrations, and enhance MetaVault yields across the board.

It’s a feedback loop that lives outside Spectra’s core team.

For Curators: A New Onchain Business Layer

So far, vault curation as a formal role has mainly existed in lending protocols like Morpho and Euler, both of which have scaled impressively

That layer hasn’t existed in the yield tokenization space. MetaVaults change that.

With MetaVaults, curators step into a structured role in the fixed-term ecosystem: they manage how matured yield is rolled into new LP positions, control the timing of pool transitions, and shape capital flow over time.

In return, they earn fees—onchain, transparent, and built into the vault structure. It’s the foundation of a new business layer—where curators can own a part of the yield funnel, offer structured access to fixed-term pools and products, and build a visible track record around it.

This opens up a vast career landscape — from protocol-aligned DAOs to independent teams and entities.Curators can expand their reach, influence, and presence across user capital, operating with the same tools that power leading DeFi players in lending.

And yes—this will come with a dedicated Curator App by Spectra - designed for performance and reputation. It’s a familiar model—now applied where it hasn’t been before. And it’s coming soon.

We invite teams, DAOs, and dedicated curator firms to get in touch with us to learn more and be among the first to experience the Spectra Curator App.

@gpeduzzi - Gaspard Peduzzi, Spectra Co-Founder

@absoluteunitt - Absolute Unit, lead BD at Spectra

About Spectra

Spectra is a permissionless interest derivatives protocol, pioneering Principal and Yield Tokens. Access fixed rates, yield leverage, and earn on your liquidity. Create pools to unlock PT and YT derivatives for any yield strategy.

App:

https://app.spectra.finance/

Join Spectra Discord:
https://discord.gg/n4Un5nZhCp
Follow Spectra on X:
https://x.com/spectra_finance

Perspective SAS (Spectra’s DevCo) deployed the necessary infrastructure and interface for existing APW and veAPW holders, allowing for a seamless migration to SPECTRA and veSPECTRA.

Open the official migration page: https://app.spectra.finance/migrate-apw

The official step-by-step tutorial for APW and veAPW holders can be found here: https://mirror.xyz/spectraprotocol.eth/SPADgYregHGvppLa4f14mfPw7PR1c0PAx66o3M_r__Q

The SPECTRA Token

Basic information

• Ticker: $SPECTRA

• Token Address: 0x64fcc3a02eeeba05ef701b7eed066c6ebd5d4e51

• Network: Base Network

• Max Total Supply: 1,000,000,000

The SPECTRA token inherits APW’s governance and utility characteristics. These include:

• Vote on changes or improvements to the protocol

• Ability to create a veSPECTRA Lock

• Earn SPECTRA incentives for locking (as voted in SIP 0)

• Gauge incentives participation

The SPECTRA token follows the same emission curve as APW.

The veSPECTRA

Basic information

• Contract Address: 0x6a89228055C7C28430692E342F149f37462B478B

• Network: Base Network

The veSPECTRA token inherits veAPW’s following characteristics:

• Entitlement to protocol earnings (3% of the yield generated by the YTs) and emissions

• Voting on Spectra Governance proposals

New veSPECTRA characteristics following SIP3:

• A 4-year ve(3,3) locker model, following veAERO/veVELO implementation.

• veSPECTRA earn 80% of protocol revenues

Plus, following the successful ve(3,3) lockers model of Aerodome/Velodrome, veSPECTRA holders can earn protocol revenues and third-party incentives in exchange for help directing SPECTRA emissions to pools.

Spectra Governance

The core governance pages — Gauges and Incentivize — will go live on the Spectra App shortly after the final APW gauge epoch ends on Thursday, 19 December 2024, at 02:00 AM CET. This ensures a seamless transition and enables participation in the upcoming SPECTRA gauge epoch.

The veSPECTRA page will launch shortly after the migration begins, allowing veSPECTRA holders to extend their locks and SPECTRA holders to create new ones.

SPECTRA and Crypto Trackers

Perspective SAS, Spectra’s development company, is actively working with token information aggregators such as CoinMarketCap, CoinGecko, and DeFiLlama to update migration details and SPECTRA token information. Please note that these updates may take some time to reflect across all platforms.

The APW Token

The APW token contract is immutable, meaning it cannot be paused, destroyed, or burned by any party. As such, the APW token will continue to exist on the networks where it has been deployed. However, if liquidity diminishes or disappears entirely over time, major token trackers and DeFi platforms may no longer display or update it.

With Spectra governance contracts now migrated to the Base Network and reliant solely on SPECTRA participation, the APW token will lose its primary utility. The APW emissions will cease on Thursday, 19 December 2024, CET 02:00 AM.

Liquid Lockers

Spectra’s DevCo (Perspective SAS) is working closely with StakeDAO to help bridge APW liquid lockers in a timely manner. Advancements will be communicated via the official channels of StakeDAO and Spectra.

Spectra & SPECTRA token brand materials can be found under this link:

https://docs.spectra.finance/brand-materials/logos

About Spectra

Spectra is a permissionless interest derivatives protocol. Access fixed rates, yield leverage, and earn on your liquidity. Create pools to unlock Principal and Yield Tokens for any yield strategy.

Join Spectra Discord: https://discord.gg/n4Un5nZhCp
Follow Spectra on X: https://x.com/spectra_finance

General information

The migration bridge will remain open until December 15th, 2025, providing APW and veAPW holders with ample time to complete their migration.

Information about the migration process and deadline will be shared throughout the year via Spectra’s official communications channels, including Twitter, Discord, and the Mirror Blog, and necessary tools accessible in the Spectra App.

Perspective SAS, Spectra’s development company, coordinates with token information aggregators like CoinMarketCap, CoinGecko, and DeFiLlama regarding the migration and SPECTRA token details. However, the new data may take some time to be reflected across all platforms.

Advanced users, multi-signature wallets, and holders of veAPW and APW via means other than standard EOA can migrate to a different wallet address.

Essential Information for APW Holders

The token split follows the 1:20 ratio, meaning for every 1 APW, you’ll receive 20 SPECTRA units.

The ratio remains fixed at all times, meaning APW holders can migrate at their own pace while receiving a predetermined number of SPECTRA units unaffected by either APW's or SPECTRA's market valuation.

Users can migrate APW to SPECTRA from any network, whether they hold APW on Ethereum Mainnet, Polygon POS, Arbitrum, or Base. This eliminates the need to move APW to Mainnet in advance. A migration can be executed from any network via the Migrate Page.

After the APW migration, SPECTRA tokens will be available on the Base Network. In some wallets, users must switch the network to Base to view them or manually import the token contract.

Users can migrate using any wallet - MetaMask, Rabby, Rainbow, Coinbase Wallet, WalletConnect etc. as long as they hold APW or veAPW.

SPECTRA tokens adhere to the ERC-20 standard and are transferable immediately after the migration. The SPECTRA token icon looks identical to APW.

The following section is for users migrating APW only. The instructions for veAPW holders are later in this article. Reviewing this section is recommended for a comprehensive understanding of the Migrate Page interface.

Step-by-Step APW Migration

Upon opening the Migrate Page, you’ll see the following panel:

Upon connecting your wallet, the left panel will display the wallet’s veAPW and sum of APW balances on all networks. The box underneath, titled “My SPECTRA Balances” is where you’ll see your SPECTRA and veSPECTRA after the migration.

The box underneath will contain links to the SPECTRA and veSPECTRA contracts. It also outlines key information about the migration, such as the token split ratio and bridge deadline.

Let’s look at the key module where the migration process takes place.

The module consists of two interactive fields: a dropdown selector, which includes a list of APW on all networks and veAPW, and an input field for specifying the number of tokens to migrate.

Underneath, the output area displays SPECTRA or veSPECTRA and the number of token units you’ll receive.

The bottom area of this module contains a step-by-step progress section that will assist users on the migration journey. Since a token migration is not an ordinary DeFi experience, users are informed upfront about the number of expected steps and the stage they are at.

Once the user enters the number of APW they are comfortable with*, the SPECTRA units field will alter accordingly, following the 1:20 ratio.

*Users can migrate APW in tranches. Since token migration is not a typical on-chain activity, users can start with a smaller amount to familiarize themselves with the process.

The [Migrate] button will only turn green when users enter the number of APW units within their wallet’s balance. Once clicked, a token approval step is expected in the user’s connected wallet, which allows the migration contract to use APW.

Once approved, the progress area will move on to the next stage, highlighting the “Confirm Bridge Transaction”. No additional user interaction is needed with the Migrate button, as the wallet will automatically bring up the transaction confirmation window. The most common wallet button label for this transaction type says “Confirm” or similar. Once clicked, the migration will begin.

The expected confirmation and the successful bridge time heavily depend on the prevailing congestion of the input network (e.g. Ethereum Mainnet) and the bridge processing time, which can take approx. 5-10min, or longer, to finalize.

After a successful migration, the final progress step will highlight “Bridge Complete” - meaning that SPECTRA tokens are viewable* and immediately transferable.

*In the early migration days, some wallets will not recognize the SPECTRA token, meaning users must manually import the SPECTRA token contract to see it in their wallets. Every wallet has a different way of importing a token, and it is advised to get familiar with this process in advance.

The SPECTRA token contract will be provided on the Migrate Page and in official announcements.

Essential Information for veAPW Holders

The veAPW -> veSPECTRA ratio is 1:10.

The veSPECTRA max lock duration is 4 years, and the veAPW is 2 years; hence, migrating 1 veAPW results in 10 veSPECTRA. The governance power remains unchanged after migration, and the veSPECTRA holder will not be diluted during or after the lock's expiry.

The veAPW lock duration will be ported to veSPECTRA.

Given the above, let’s see an example: If your 100 veAPW unlocks in 450 days, you’ll receive 1000 veSPECTRA unlocking in 450 days.

The 1:10 ratio remains fixed at all times, meaning veAPW holders can migrate at their own pace while receiving a predetermined number of veSPECTRA units unaffected by either APW's or SPECTRA's market valuation.

Step-by-Step veAPW Migration

When veAPW is selected from the dropdown, holders with a lock ending after the bridge deadline can proceed with migration to veSPECTRA in a similar manner to APW migration.

Note: When migrating veAPW, token approval is not required.

Users with veAPW lock expiring before the bridge’s deadline will receive immediate notification and must either extend the lock period or wait for the unlock date before migrating.

The need for this action arises from the technical limitations of veAPW, which cannot be burnt or frozen. Consequently, veAPW holders could unlock their APW tokens before the bridge's deadline, even after migrating to veSPECTRA. In other words, they could still retain the right to unlock APW from their original veAPW while simultaneously holding the newly minted veSPECTRA.

To prevent this unfair scenario for other ecosystem participants, veAPW holders whose lock ends before the bridge’s deadline must extend it or wait until it is unlocked and proceed with standard APW migration.

Since veAPW lock extensions operate on a weekly cycle, the extension must be at least December 22, 2025, or beyond.

Unlock Period Management

To check the unlock date, access the V1 App: Navigate to old.spectra.finance → Manage Locked APW → Increase Time tab:

For holders opting to wait for the unlock date, it is important to complete migration before the bridge’s expiry on December 15th, 2025.

Tracking Bridge Transactions

At the bottom of the migration module, an external link titled [Migration history and status] leads to a tracker powered by Layerzero Scan, in which APW and veAPW holders can preview the status of their submitted bridge transaction(s).

The bridge transaction can range from 5 to 10 minutes or longer, depending on network congestion and bridge processing time. Once completed, the status will show ‘Delivered’.

Adhering to the guidelines outlined in this article ensures a smooth transition to SPECTRA and veSPECTRA tokens.

Key contract information and additional resources will be available on the Migrate Page and in the official migration article published at the start of migration.

For any troubleshooting, opening a support ticket is possible anytime via Spectra’s Discord: https://discord.gg/e2PfbPenMB

Spectra now offers the industry's top fixed-rate opportunities for stablecoins and ETH. Our pools drive growth for other projects and receive significant public interest in apps built on the Spectra protocol.

This article will discuss Spectra’s next chapter, made of 5 pillars:

• The $SPECTRA token

• The release of App V2

• A Base-first approach

• Expanding synergies with Curve Finance

• MetaVaults

The SPECTRA Token

On 2 December 2024, a proposal outlining the $APW token's migration to $SPECTRA was posted on the Spectra governance forum. This migration reflects the protocol’s evolution and readiness to embrace a new chapter, driven by both timing and a refined tokenomics framework.

While $APW remained central to Spectra governance during this transition, it also carried the technological debt and immutability of the APWine era. As Spectra positions itself as a decentralized and permissionless financial primitive, its tokenomics must evolve alongside the protocol to better support liquidity bootstrapping mechanisms, such as bribes and protocol fees.

With several months of protocol operation behind us, the migration to $SPECTRA aligns governance, liquidity strategies, and recognition under a unified identity, positioning the SPECTRA token as the foundation for Spectra's continued growth.

New Tokenomics Framework

Under the new tokenomics framework, all Spectra governance activities—proposal voting, gauge voting, and claiming veSPECTRA rewards—will take place on Base, significantly reducing entry barriers for new participants. The forum proposal outlines the migration details for the existing veAPW holders.

The proposed tokenomics framework adopts a Base-first strategy for the SPECTRA token, positioning the Base ecosystem and its decentralized exchanges as the foundation for bootstrapping SPECTRA’s liquidity.

The proposal features a 1:20 (APW:SPECTRA) migration ratio, capping the SPECTRA token theoretical max supply at 1B units.

Additionally, the migration involves burning the DAO’s remaining APW supply initially allocated for incentives and progressively minting SPECTRA tokens instead. This process employs a curve formula that sets a maximum total supply below the current one (proportionally to the APW:SPECTRA ratio), ensuring non-dilutive migration.

The Right Timing

As the year’s fastest-growing EVM, Base leverages its rapidly expanding user base driven by the Coinbase ecosystem, cementing its central role within the Optimism Superchain. Deploying SPECTRA on the Base Network strategically places the Spectra ecosystem at the forefront of DeFi’s ongoing expansion.

The App V2

The App V2 addresses user feedback since the V1 launch with the following changes, adjustments, and improvements:

• The V2 better resembles an actual trading environment

• Brings all product pages to the center view, allowing for a much clearer interaction

• Key action modules better highlight benefits to users—aiming for increased user success rates

• Introduces efficient APY charts with numerous data points for more informed user decisions

• Aggregates products from all networks into a single page, allowing users to preview all available opportunities at a glance

• Introduces audited zap module, allowing users to get started with a wide range of tokens from their wallet

Most importantly, key product pages—Pools, Fixed Rate, Yield Leverage, and Portfolio—will be available on mobile devices, making the Spectra protocol usable to a mobile-first Base audience.

Base-first approach

Spectra strengthens Base’s permissionless DeFi stack by introducing a critical financial component—interest rate derivatives. Deploying the SPECTRA token on Base ensures users can obtain it with low network costs while broadening its usability across the DeFi ecosystem.

Positioning Base as the central network for SPECTRA’s liquidity addresses key barriers to governance participation. Lower costs for acquiring SPECTRA and performing on-chain actions like gauge voting are critical during the early bootstrapping phase of new Spectra pools.

Aerodrome, the leading DEX on Base, has demonstrated a powerful flywheel effect for liquidity bootstrapping, effectively supporting projects such as Origin’s SuperOETH and Moonwell’s WELL.

Launching a SPECTRA pool on Aerodrome, bolstered by AERO emissions and Base’s low-cost, rapidly growing ecosystem, offers a more efficient liquidity environment than existing APW setups on Ethereum Mainnet.

Furthermore, Perspective SAS, Spectra’s development team, will intensify business development efforts on Base, focusing on building stronger relationships with Base-native projects and community leaders.

For Spectra's flagship front-end, the team is adopting a Base-first strategy, leveraging the tools and infrastructure provided by the Base/Coinbase developer platform to enhance functionality and user experience.

Expanding Synergies with Curve Finance

The fourth pillar of Spectra’s next chapter focuses on deeper collaboration with Curve Finance’s core contributors. Together, we have worked to enhance the efficiency of Spectra pools, which Curve’s AMM powers.

While Spectra’s yield primitives adhere to the ERC-20 standard, their technical nuances, constraints, and maturities demand unique pool parameters to enable effective yield swaps.

Early in the lifecycle of Spectra App V1, inefficiencies emerged—pools with adequate TVL and sufficient Principal Tokens were often unable to support even small trades. These issues led to reduced protocol activity, user frustration, and a lack of organic growth through word of mouth.

We have successfully addressed these challenges after extensive collaboration with Curve’s team. Newly deployed Spectra pools now feature optimized parameters, eliminating the inefficiencies that previously hindered trading activity.

Why does efficient pool architecture matter?

Better liquidity leads to better user rates, driving greater adoption of Spectra products. This increased usability translates to higher rewards for LPs, making pools more attractive and drawing in new liquidity. More liquidity means deeper trades can be facilitated, creating a positive feedback loop that scales the protocol’s impact.

MetaVaults

MetaVaults are in the final stages of internal development at Spectra’s devco, Perspective SAS, and are planned for release in Q1 2025. This innovative technology has been under development throughout 2024 and is set to revolutionize liquidity provision for DeFi’s interest rate derivatives.

MetaVaults address critical challenges in the current liquidity model. First, they resolve liquidity fragmentation. Currently, when a pool expires, LPs must manually reallocate funds to new pools—a process that often leads to turbulence, reduced TVL, and inefficiencies as liquidity remains idle. MetaVaults solve this by automating pool redeployment and enabling seamless liquidity rollovers, allowing LPs to participate in a true "set-and-forget" manner.

Second, MetaVaults enhance pool’s yield by automatically converting Yield Token (YT) accruals into additional LP tokens. Today, this process requires manual intervention, which is both time-consuming and cost-inefficient. MetaVaults unlock greater yield for LPs without additional effort by automating this conversion.

Finally, MetaVault design introduces customizable features, drawing inspiration from Morpho’s Vaults' success. This flexibility will allow third-party curators to design and launch yield markets with tailored parameters and branding, casting a wider net for attracting new liquidity providers and expanding Spectra’s ecosystem reach.

MetaVaults represent a pivotal advancement, setting the stage for sustainable growth and a more streamlined, user-centric liquidity experience.

Final Remarks and Timeline of Events

Spectra’s App V2 is scheduled for release in 2024. The APW → SPECTRA token migration is currently under community discussion, with its timeline dependent on community approval. If adopted within the next two weeks, these changes could be executed by the end of 2024.

The new pool architecture is already reflected in newly deployed pools, improving swap efficiency. MetaVault release trajectory looks optimistic for Q1 2025. While the Base-first strategy marks a key focus, SPECTRA’s gradual liquidity expansion to additional networks remains a longer-term objective.

Alright, you've created your first pool on Spectra. What can you do next?

Head over to this article if you are yet to create your first pool.

Article breakdown:

1. Post-Setup Visual Enhancements

2. Marketing Tips

3. Drawing Liquidity Providers via Gauges

4. Engaging Project Treasuries

1. Post-Setup Visual Enhancements

After setting up your pool, it might look raw, with minimal TVL and no token icons. Let’s first fix that to make your pool more visually inviting.

If the Spectra App didn’t detect any icons for your pool’s assets, you can request their addition in two ways.

#1 Open a Discord ticket and use the following template:

Spectra App Pool URL: https://app.spectra.finance/pools#base/0xdc2b69aa3c13cab8010b8cc3c4e838b2b005089f
IBT icon: icon.svg / png [attachment]
Underlying icon: icon.svg / png [attachment]
Underlying platform's name: {Harvest} (Optional, but highly recommended)

#2 Create a pull request for inclusion in Spectra's Token List. Follow this GitHub guide on this: https://github.com/perspectivefi/token-list

No official icons? No problem. Create them yourself and submit them.

Here’s a preview of your pool's appearance with icons and the iBT-issuing platform name.

Icons and platform names improve your pool’s appearance and help users identify where the iBTs originate, boosting engagement and trust.

Note: the Spectra App will apply colorful rings around submitted token icons.

Legend: PT - flashy green YT - flashy yellow LP - flashy pink

2. Marketing Tips

Now that your pool looks good, it’s time to get the word out.

Here are some effective marketing tips:

#1 Share the news on Spectra's main discord channel

The Spectra community loves new pools. Share the news on the main channel. Keep it organic, personal and let everyone know its purpose.

Below is a template that you can steal:

Hi all! I am [name] from [introduce your project briefly here] and just launched a pool for [asset], [link]. Following that, you can add more background, e.g., if your plan is to implement the technology into your product, create yield markets on top of your yield strategies, or else.

Tip: create a combo of #1 and #2, just keep on reading⬇️

#2 Tweet about it

Share the news about the newly created pool on your personal or project's Twitter account:

The content of such a tweet can be identical or similar to your Discord message from tip #1, or it can tell the story in a different way while using tickers and tagging @ respective projects.

Attaching a good crop of Spectra's App with your pool presented on it will help it get more exposure/real estate on the Twitter timeline👍

You can reverse the process and post the tweet first. Shortly after, say hi in Spectra's main channel as per the #1 tip and include the link to your tweet in the message. That way, you can get initial engagements on Twitter/X for your newly published post.

#3 Inform respective project members about the pool

Engaging the respective project's community members is another way to put your pool in the spotlight. Each interest-bearing token has its own issuing platform, and it's worth informing their respective communities about the pool via Discord or Twitter.

Each new financial use case unlocked by your Spectra pool is worth highlighting: fixed rates, yield trading, or a new liquidity venue for that project.

Below are examples of organic community voices, which can then be amplified by the main Spectra Twitter account:

Ask for Feedback: If you plan a detailed Twitter thread, ask for feedback on Spectra's Discord. You can open a ticket for proofreading or simply ask in the main channel. Spectra mods and contributors are quick to help. Spectra’s main Twitter account can amplify your content only if the content is accurate.

#4 Quote-replying to community member's Tweets

Another low-hanging fruit for putting your pool in the spotlight is engaging with Spectra or your community members' tweets in public. Replying to them with merit and sparking genuine discussions can create another reason for Spectra to put it in the spotlight by retweeting tiered quote replies.

The TVL of your newly created does not matter to Spectra Twitter account operators.

#5 Commenting on the usage of your pool

You can find your pool's smart contract address in the Spectra App, which points to an Etherscan explorer.

Previewing the latest transactions under the Token Transfers (ERC-20) tab can give you more legitimate reasons to talk about your pool:

Above, we can observe how a user added liquidity to the pool a few hours ago. Such interactions can be highlighted on Twitter in the following manner:

Tip: Even if it’s just the first $1 deposited into your pool, it’s the first sign of interest to be excited and shared about.

Share these real interactions on Twitter to demonstrate actual use and encourage further participation. You can also re-share it in Spectra's Discord for the community's initial engagement.

3. Drawing Liquidity via Gauges

Once your pool is set up and you’ve given it visibility, the next step is attracting liquidity.

Spectra’s native Gauges allow you to get more value for your incentive spending.

For example, spending $500 on incentives could attract enough veAPW holders' votes to result in protocol APW incentives worth significantly more, such as $1000 in APW incentives. This effectively boosts the APY of your pool, making it more attractive to liquidity providers.

First, a word on veTokenomics

veTokenomics is a model that encourages long-term participation by having users lock their tokens for a certain period. In return, they receive veTokens, which, for example, grant them governance rights.

In the Spectra ecosystem, APW holders can lock their tokens for up to 4 years and receive veAPW tokens in return.

One of the utilities of veAPW tokens is the ability to control how APW protocol incentives are distributed to pools via Gauges.

By voting on this distribution, veAPW holders earn incentives provided by 3rd parties.

The Gauges section is accessible via the Spectra App.

It's where veAPW holders decide which pools shall receive APW incentives that enhance their APY, potentially drawing more liquidity providers.

How do you get your newly created pool listed in the Gauges section?

Anyone can create a Spectra pool, but getting it listed in the Gauges section requires community approval.

Why Gauges Matter

Gauges determine which pools can be eligible for APW incentives, enhancing the pool’s APY and attracting more liquidity providers. This can be crucial for the growth and visibility of your pool.

Prepare Your Spectra Gauges Request (SGR)

Use the Spectra Gauges Request Template to create your proposal. This includes details like the targeted pair, contract addresses, current TVL, and community links.

Provide a brief description of your project and the benefits of integrating the gauge for your protocol and Spectra.

Preview previous SGRs at https://gov.spectra.finance/c/spectra-gauge-request-sgr/23

Submit Your SGR

Create a free account at gov.spectra.finance and post an SGR with a poll in this section at no cost, anytime.

Engage with the community on the forum, explaining your proposal and addressing any questions or concerns.

After 3 days, if the community supports your proposal, it can be submitted for voting on Spectra’s Snapshot with 3 voting options: Yes, No, and Abstain.

Spectra community members with veAPW tokens will vote on whether to approve your gauge request.

The vote can last 48 hours to 7 days. After this period, if the total number of votes is below the quorum threshold of 5% of the veAPW supply or if “No” votes exceed “Yes" votes, the proposal fails. If the total number of votes exceeds 5% and “Yes” votes outnumber “No” votes, the proposal will be passed, resulting in the addition of a Gauge for your pool.

After your Spectra Gauges Request (SGR) is approved, your pool becomes eligible for Gauges voting and APW incentives within 14 days.

If your SGR is rejected, you can resubmit it at any time. Ideally, you should address the community's concerns mentioned in the initial feedback.

Navigating the Incentivize Page

The next step is to use the Incentivize page effectively.

Here's how it works:

1. Select Your Pool: Use the dropdown menu to select your pool or any other you want to incentivize.

2. Choose the Incentive token: Pick a token to offer as an incentive to veAPW holders. Spectra App has a bunch of whitelisted tokens like USDC, ARB, DAI, or stETH.

3. Add Incentives: On the right panel, approve the token and provide incentives.

Once you deposit tokens as incentives, you won't be able to withdraw them.

After confirming the transaction, the Gauges page should instantly reflect your incentives. See the following example:

Tip: If you want to incentivize with a token that’s not listed, contact the Spectra team on Discord. Open a ticket and provide token details and reasoning for getting it added.

Spectra's Gauge voting epochs run from Wednesday to Wednesday, UTC midnight. It is generally recommended to post incentives early on during the epoch, as veAPW voters cannot undo their selection.

At Wednesday UTC midnight, the Gauges system allocates APW incentives according to the number of votes received from veAPW holders.

The incentives you provide for a specific pool gauge are distributed among all veAPW holders who vote for that gauge.

When your pool receives veAPW votes, the amount of APW incentives is directly proportional to the number of votes. The general rule is: the more votes, the more APW incentives.

At the end of the voting epoch, the final vote count and the corresponding APW incentives for a pool are determined. These details can be viewed shortly after Wednesday, midnight UTC, on the Gauges page under Votes and in the LP incentives column, shown in USD.

Lastly, on the Pools page, by hovering over the APY%, the tooltip breakdown displays how much the APW incentives, referred to as rewards, contribute to the overall APY of your pool. Example below:

The APW incentives from gauges increase the pool's APY, potentially attracting more liquidity providers to your pool.

4. Engaging Project Treasuries

Another way to attract liquidity to your pool is by leveraging the treasury of the project from which your pool's interest-bearing token originates.

A Spectra pool unlocks a yield marketplace on top of existing yield strategies, and each strategy has its original platform with a community and treasury.

Most DeFi projects with yield strategies have a governance framework that allows anyone to start a discussion on new initiatives. This means you can open a free governance account and propose ideas, such as engaging the project's treasury with Spectra.

For example, on Lodestar, a community initiative began with a governance proposal outlining what Spectra offers and the importance of seeding the pool on top of Lodestar's yield strategy. This proposal was then put to a vote on the project's Snapshot and approved by the community.

Initiating a discussion on governance forums or public Discord channels presents another occasion to tweet about (people on X love raw alpha in the form of Discord screenshots!) and let other community members know about your initiative, and have them join the discussion.

Start by tweeting about the discussion from your personal account, tagging relevant community members, and then resharing it across respective Discord channels. This approach can help bring initial attention to your initiative.

Below is an example of how community accounts can create buzz at any proposal stage and put your account in the spotlight.

This is the end of the Part II.

About Spectra

Spectra is a permissionless protocol for interest rate derivatives. Anyone can create new markets at will, swap yield derivatives, or become a liquidity provider.

Twitter | Docs | App | Discord

1. Just 2 minutes of history, we promise.

2. The Uniswap<>Spectra analogy explained

3. Benefits for pool creators, end users, and a project's community as a whole

4. Setting up a pool [step by step]

5. Understanding APY breakdowns

6. What are my earnings, and where do I claim them?

7. Extra Notes

8. What's coming in Part II

1. Just 2 minutes of history, we promise.

Remember what Uniswap did for DeFi? It allowed anyone to create a pool permissionlessly, sparking a Cambrian explosion of projects releasing their ERC-20 tokens for everyone to trade.

To date, token trading is DeFi's main activity.

Token innovation did not stop there. Crypto projects expanded to offer services like lending and staking, allowing ERC-20 token holders to earn yield.

This gave rise to interest-bearing tokens (iBTs).

For example, depositing USDC in a lending protocol such as Aave returns aUSDC, a token representing the initial deposit and the entitlement to future yield.

Today, there are more than 11,000 yield-generating strategies across DeFi, each with its own interest-bearing token (iBT), acting as a receipt/proof of funds and entitlement to yield.

The most common concern for iBT holders is exposure to interest rate volatility.

You might earn 15% on USDC one day, only to see it drop to 7% a week later. Rate volatility makes financial planning in DeFi difficult.

Spectra addresses that problem, and here's how:

2. The Uniswap<>Spectra analogy explained

Uniswap revolutionized ERC-20 token trading. Spectra aims to do the same for ERC-4626 tokens, representing interest-bearing tokens from major protocols like Aave, Morpho, Yearn, and Balancer.

Spectra lets anyone create a pool for any ERC-4626 token, enabling users to exchange floating interest rates for fixed interest rates and vice versa.

Without going too technical, Spectra creates yield derivatives called Yield Tokens (YTs) and Principal Tokens (PTs) on top of interest-bearing tokens. See the simplified explanation below:

In short, Yield Tokens offer exposure to interest rate volatility, while Principal Tokens offer fixed rate capabilities.

These financial activities would not be possible with a standalone interest-bearing token.

3. Pool benefits for liquidity providers, end-users, and a project's community as a whole

Now, let's break down the benefits for different market players:

Pool creators/liquidity providers

• Earn pool fees on yield swaps

• Maintain exposure to the yield of their iBT

• Can earn Spectra's native APW incentives

• Can benefit from incentives provided by third parties

In summary, interest-bearing token holders have the opportunity to increase their earnings, as opposed to passively holding them in their wallets.

End-users

• Can trade yield akin to price trading

• Can hedge from APY volatility

• Can purchase their favorite crypto at a discount (Principal Tokens design is akin to zero-coupon, offering a fixed value at maturity)

• Can join as a liquidity provider to existing pools

Project's communities

• Can unlock new financial tools on top of their existing vaults: fixed rates and yield trading, which can be further abstracted into following narratives, such as discounted tokens or fixed savings

• The enhanced Spectra pool APYs generally exceed those of a standalone interest-bearing token, making Spectra an exciting venue to source new liquidity

• Can integrate Spectra's technology into their products, allowing users to, e.g., fix interest rates directly in their app and charge an extra service fee for it

4. Setting up a pool

To get started, head over to the Spectra App -> Pools page.

-> https://app.spectra.finance/pools

You will see the [Create Pool] button in the top area.

A compatible interest-bearing token following the ERC-4626 standard is the primary ingredient for starting a pool.

ERC-4626 is a popular vault standard adopted by many projects such as Aave, Balancer, Frax Finance, Yearn, Morpho, Maker, or Ethena.

See https://tvl.erc4626.info/ for a comprehensive list.

How do I know if my interest-bearing token is ERC-4626 compatible?

The easiest way to find that out is by clicking on [Select IBT] to be presented with the following token selector view:

Here, by default, Spectra displays a few ERC-4626 compatible tokens. If you don't see yours on the list (you don't have to have it in your wallet to check ERC4626 compatibility), get the iBTs address from, e.g., Etherscan and paste it into the search field:

If a result appears, your iBT adheres to the ERC-4626 standard, and you can proceed.

Next, you need to set the maturity date and initial implied APY.

Maturity sets the expiration date for yield derivatives. Depending on the pool creator's needs, it can range from 2 days to decades.

The starting date is pre-defined and cannot be changed.

The 3-4 month period is a great choice for those who are just getting their feet wet with Spectra.

Setting a pool maturity doesn't mean your iBTs will be locked until then. It just sets the expiry/maturity date for yield derivatives.

On that note, we'd like to point out that 'expiry' is more commonly used for all things related to Yield Tokens and yield trading, while' maturity' is a more commonly used term when discussing Principal Tokens and fixed rates.

Initial implied APY

To set this value, check the original platform of your interest-bearing token for APY details. Most platforms, like Aave or Harvest Finance, provide APY breakdowns that can be used as a reference.

Example from Aave's market details page:

Example from Harvest Finance farm's details page:

The Initial Implied APY is the discount rate applied to the Principal Token on day one. For example, setting a 10% Initial Implied APY means the pool's PTs are priced with a discount that reflects this annualized APY.

As of July 2024, Spectra is DeFi's only platform allowing permissionless pool creation for yield derivatives.

Thus, most users setting up a pool for the first time for a given iBT will find no clear reference elsewhere. That's why, to set this value, we recommend looking up the historical average APY of a given iBT.

If a platform does not offer historical APY data, an independent source, such as DeFillama's yield page, can be of help.

If an iBT has little to no historical average APY available, the live APY can be used to set the Initial Implied APY.

Lastly, there's a Pool Fee parameter, which is pre-set by the Spectra App.

The Spectra App automatically adjusts the Pool Fee parameter to ensure an efficient trading environment from the start. This fee goes to liquidity providers and can be subject to underlying AMM protocol fees, such as Curve's AMM 0.005% DAO fee.

Once you have the maturity date and initial implied APY, here's what the setup might look like using sUSDT iBT:

The pool creator receives an LP token composed of iBT and Principal Token. Yield Tokens also result from the yield tokenization process; however, they are not a part of the pool composition.

LP token holders remain entitled to fees from Yield Token (YT) swaps as they are driven by flash swaps utilizing the PT<>iBT pool.

Note: Selling yield tokens (YTs) immediately after creating the pool is not advised. During the yield tokenization process, YTs are issued to the creator's wallet. Since liquidity often comes from the same person who then tries to sell the YTs, this can imbalance the pool's liquidity and undermine its stability.

After creating a pool, you can preview its existence on the Spectra App's Pools page.

To quickly find your pool, check the Tokens in my wallet box or search for its name.

You will find LP Tokens on the Portfolio page under the Liquidity tab.

5. Understanding APY Breakdowns

Whether you're the pool creator or joining an existing pool, the best way to preview the yield source is to hover your mouse over the Pool's APY on the Pool's page.

Typically, one of the following breakdown types will appear:

A. New Pool APY Breakdown

This is a typical APY breakdown for a newly created pool, comprising only iBT yield and PT's fixed rate. The LP Fees show 0% because this pool has not facilitated swaps, while LP Rewards show 0% because APW incentives have not been streamed to it yet.

Spectra may display a different iBT APY than the issuing platform (e.g., Aave) or a yield tracker (Defillama).

This discrepancy occurs primarily because of the difference in the range of historical data used for APY computation.

B. Early Stage Liquidity Pool Breakdown

Besides the standard PT and iBT yield, this breakdown displays fees from facilitated swaps and APW incentives. As we can observe, while swaps have occurred within the pool, they contribute little to the overall APY and are displayed as <0.01%. APW incentives are the main APY driver.

This APY breakdown is common in the early stages of a liquidity pool, where incentivizing liquidity is essential to overcome the 'cold start' problem and facilitate significant swap volumes. During this phase, incentives make up most of the displayed APY, while swap fees typically remain low.

C. Underlying Platform Incentives Breakdown

In this case, in addition to the yield streams outlined in A and B, underlying platforms issue incentives to iBT holders. These incentives are typically issued for a certain period and claimable at the end of it.

Typically, if you see additional tokens underneath iBT in Pool APY breakdown, it results from manual integration. Pool creators and liquidity providers should monitor announcements from the underlying platforms to understand when these incentives will be distributed.

Note that even if the underlying platform issues the incentives to iBT holders, the Spectra team might need additional time to relay and make them claimable within the Spectra App.

D. Points Programs Breakdown

In addition to the yield streams outlined in A and B, iBT holders might be entitled to various points programs. Points programs are manual integrations and do not contribute to the displayed APY.

6. What are my earnings, and where do I claim them?

Several yield sources can contribute to the pool's overall APY. Here's a detailed explanation of where each is reflected in the Spectra App and how to claim them.

LP Token Overview (iBT + PT Fixed Rate + LP Fees)

The LP Token you receive from pool creation contains interest-bearing tokens (iBT) and their corresponding Principal Tokens (PT).

When a swap occurs within the pool, a fee is charged and distributed proportionally among all LP token holders, increasing the value of their tokens.

The $ value of the LP token, which includes swap fees, can be found under the Balance column in your Portfolio.

Stablecoin Pools:

• Value increases from swap fees are most apparent in stablecoin pools.

Volatile Asset Pools:

• In pools with volatile assets (e.g., aWBTC and PT-aWBTC), the Balance column reflects both the increased value from swaps and the underlying asset's price fluctuations.

APW & Other Rewards

Rewards issued to LP Token holders, such as APW or third-party incentives, can be claimed by clicking the Manage button -> Claim Rewards.

This action opens a drawer displaying rewards for this particular LP Token:

To preview rewards for all your LP Token positions or those you are still entitled to after winding down the LP Token, click the See Rewards button on the Portfolio page.

Note: If Claimable Rewards show a different $USD value than the Rewards column, it means you have already claimed a portion of the accrued rewards. The Claimable Rewards $USD value displays only what's left or yet to be claimed.

Points

Spectra App offers a dedicated Points page where pool creators and liquidity providers can check the status of their LP Token and respective points allocation. Links to underlying platforms for previewing allocations are also available.

Points are manually integrated with underlying projects, which can cause delays in the Spectra UI reflecting the most current data on that page.

In the next guide, we'll discuss how to participate in gauges and share tips on promoting your pool.

Extra Notes

• Interest-bearing tokens can have short and elegant names, such as aUSDC, while some may represent a complex yield strategy with a far more complex one, such as LQIDETHFIV1 or auraB-rETH-STABLE-vault

• Most iBTs do not have a token icon, so Spectra displays a default grey icon. If your iBT has an icon that Spectra doesn't detect, please reach out to us on Discord, and we will implement it.

• After you create a pool, when someone else joins the pool with more funds, your percentage ownership decreases as new LP tokens are issued to the new provider. Still, your absolute share of the pool’s total value remains proportional to your initial contribution.

• Impermanent loss inside Spectra pools is negligible due to the following factors:

  1. PTs are redeemable for one underlying value at maturity (unless there is a negative yield)

  2. IBTs increase in underlying value within the pool

  3. PT and IBT values are highly correlated

• When providing liquidity to Spectra pools, there's no time lock

About Spectra

Spectra is a permissionless protocol for interest rate derivatives. Anyone can create new markets at will, swap yield derivatives, or become a liquidity provider.

Twitter | Docs | App | Discord

The attacker managed to hijack user transactions, resulting in a loss of around 168 ETH. The attack occurred on Ethereum Mainnet, and our team’s swift reaction enabled us to limit the effects as a total of 4 wallets were impacted.

The core protocol contracts remain unaffected, and the funds inside them are safe.
The Spectra App (https://app.spectra.finance/) was reinstated in the morning CET hours on July 24th and is safe to use.

Technical Breakdown of the Vulnerability

The incident resulted from the exploitation of a command in the routing utility contract. This command allowed Spectra users to enter and exit the pool with a token of their choice. After prompting users to leave the pool the attacker exploited the command in order to sweep funds once a user unknowingly approved the transaction on the router.

Incident Response

A suspicious Discord user, believed to be the attacker, started making false claims about issues with Spectra's YT token contracts to prompt users to withdraw funds. Those who attempted to withdraw were required to approve the transaction first, making them vulnerable to the attack.

Upon identifying the attack vector, our team promptly activated an incident response plan, disabling the Spectra App and terminating router contracts that enabled the attacker to hijack transactions.

As a precaution, Principal Token contracts were paused, preventing token exchanges at Curve's pool level (Spectra's primary AMM). The contracts were unpaused at approximately 9 PM UTC the very same day.

Links

The attacker’s wallet where the stolen funds were transferred: https://etherscan.io/address/0x53635bf7b92b9512f6de0eb7450b26d5d1ad9a4c

Recovery Efforts

Spectra's top priority is recovering affected users' funds. Authorities and relevant third parties, including leading exchanges and industry-leading security teams, have been contacted for their support and expertise in tracing and recovering funds.

We have also sent the hacker an on-chain message, offering to close the case if they return 90% of the stolen funds:

https://etherscan.io/tx/0x184c4273489fa81fa5d9cf6ae80080b6277712dafec408d166ed1cf9c78037fe

If you are an affected wallet holder, please complete the following form so we can contact you directly:

https://docs.google.com/forms/d/e/1FAIpQLSdM6iwAN4l8uSDpqniOef6TuAt2jC71qh2wUaLy0iiFeePcDg/viewform

Spectra’s Safety

In an environment where it is technically impossible to foresee all potential sources of attacks, we are doing our utmost to guarantee the highest level of security through regular external audits of our contracts and the use of best practices. We continue collaborating with security experts to resolve this situation and provide community updates via Twitter and Discord as we progress.

If you have any information that would help resolve this case, please get in touch with the Spectra team via incidentresponse@spectra.finance

We appreciate everyone's support!

Spectra becomes DeFi’s first permissionless interest rate derivatives protocol, allowing any individual, DAO, or company to participate in the rapidly growing yield tokenization sector.

With Spectra, anyone can launch a pool for yield derivatives (Principal & Yield Tokens) and unlock new financial possibilities, such as fixed rates, yield trading, or instant yield.

Following Uniswap’s permissionless pool creation design for any ERC-20, Spectra allows this for the ERC-4626 vault standard, which, as of June 2024, collectively amounts to over $9B TVL.

Holders of interest-bearing ERC-4626 tokens can use them to create a Spectra pool and earn additional yield from swap fees, 3rd party incentives, and the protocol’s APW emissions to pools. All of this is achieved while staying entitled to the native yield of the ERC-4626.

Visit Spectra’s flagship interface: app.spectra.finance

Setting a new standard for permissionless interest rate derivatives.

Spectra introduces an end-to-end permissionless design, setting a new standard for yield tokenization. Previously, projects and individuals had to contact yield tokenization platforms and negotiate pool creation manually.

With Spectra, anyone can start a pool by simply providing three ingredients: an interest-bearing token of any amount, a maturity date, and a target APY. Once created, the pool powers the yield derivatives swaps.

Core protocol contracts: https://github.com/perspectivefi/spectra-core

Enhanced Utility for Interest-Bearing Tokens

Spectra enhances the financial utility of ERC-4626 tokens, enabling functionalities such as:

• Fixed Rates: Stakers, farmers, or lenders can hedge from APY volatility and lock in future earnings.

• Yield Trading: Traders can speculate on the fluctuations of the APY rates of interest-generating tokens.

• Pool Creation: Liquidity providers can start a pool to earn fees and additional rewards.

Developers

Spectra’s flagship app is just the tip of the iceberg of what’s possible with Spectra’s protocol and its primitives. We invite builders and researchers to explore the documentation and get inspired by some of the following use cases.

Permissionless Principal & Yield Tokens

Builders can integrate and leverage Spectra’s primitives for their needs.

Principal Tokens offer fixed value at maturity and can be used in various narratives, such as fixed savings, discounts, or yields. For example, existing yield platforms can leverage Spectra’s infrastructure to allow users to fix APY on their native interfaces.

Yield Tokens offer exposure to the APY evolution of their interest-bearing token. For example, YTs can be at the core of next-gen trading dashboards or used for sophisticated yield strategies.

Custom-made Curve parameters

Under the hood, Principal Tokens are paired against Interest-bearing Tokens (e.g., aUSDC) in Curve AMM pools. With Spectra’s custom-tailored parameters, leveraging this pool model allows for efficient PT<>iBT swaps and redemptions with negligible impermanent loss.

With Curve being plugged anywhere in DeFi, PT<>iBT pools can be implemented and combined with yield strategies, further enhancing the existing project’s APRs.

The core protocol mechanisms can be abstracted in various ways, such as fixed savings, discounted assets, upfront yield, instant yield, and other narratives that have yet to crystallize.

Governance

During the Spectra’s building phase, several proposals have passed that influenced Spectra’s governance and emissions:

SGP0 - Snapshot Setting the additional APW distribution to lockers to 10800 APW per month.

SGP1 - Snapshot Initiating APW reward distribution to the new APW/ETH 1% Uniswap V3 pool on Ethereum.

SIP0 - Snapshot Updating veTokenomics & setting protocol fees to LPs at 0% during the protocol’s bootstrapping phase

SIP1 - Snapshot The introduction of a Spectra Gauge Request (SGR) allows for adding or removing a gauge for a specific Spectra pool.

The APW Token

The APW token remains at the core of the Spectra Protocol.

Spectra’s updated governance model allows stakeholders who lock APW for veAPW to vote on proposals and gauges. In return for helping gauge protocol emissions, they can earn a share of third-party incentives and protocol/pool fees. Users will soon be able to vote on gauges when the first pools are whitelisted by the Spectra DAO via SGR.

After the protocol bootstrapping phase, two proposals will be put on the governance forum to enable a protocol fee on swaps and redirect the fee to veAPW voters.

Audits

After a year of extensive research and development, Spectra's protocol core contracts have undergone a public audit by Code4rena and a private audit by Pashov Audit Group.

Both audits found no critical or high issues, and the auditors appreciated the high quality of the code.

Code4rena report:
https://code4rena.com/reports/2024-02-spectra

Pashov Group report:
https://github.com/pashov/audits/blob/master/team/pdf/Spectra-security-review.pdf

What’s Next

This release marks the first step in deploying Spectra’s permissionless core primitives.

Many upcoming protocol and interface enhancements are already being developed. These include addressing liquidity fragmentation across assets and manual rollovers, among other improvements.

Spectra will also become AMM-agnostic, allowing LPs to choose the right AMM to power pools that suit their needs.

Spectra’s Yield Marketplace, previously hinted at, has an interactive prototype ready.

At the interface level, users will be provided with more trading instruments, such as limit orders. New L2 deployments and ecosystem integrations, including lending markets, UI improvements, and innovative strategies, are also on the horizon.

The direction is clear, and the exact steps are shaped by a trial-and-error approach and a feedback loop with each iteration.

A word on business development

Spectra’s core team has been actively working with DeFi teams during the development phase, showcasing how Spectra can enhance their ecosystems. The proactive engagement and organic interest from various projects have led to several integrations already being in progress.

Anyone can suggest an improvement or integration and become influential in Spectra’s development at the protocol or interface level via gov.spectra.finance or by starting a community discussion on Discord.

About Spectra

Spectra is an end-to-end permissionless protocol infrastructure and a flagship app for DeFi’s interest rate derivatives.

Visit spectra.finance

Join the Spectra community on Discord | Follow Spectra on Twitter/X

Below, you will read about the crucial Beta improvements based on user feedback, a first glance at the Yield Market UI, our steps toward ensuring top-notch security for the upcoming mainnet release, research developments, and more.

Spectra Beta

On August 8th, we announced that our Beta was open for everyone to explore, emphasizing that there was no need to connect a wallet anymore to look around. This approach resonated with users, as they felt more at ease exploring without linking their wallets.

The subsequent days brought in a surge of feedback, especially from seasoned DeFi users. Some of the main points they highlighted were:

• A need for a more detailed portfolio overview

• The addition of tooltips and guidance throughout the user journey

• The user interaction sidebar appears on the right, blocking wallet pop-ups and notifications

• Suggestions for Lite and Pro UI modes

We hear you. We went back to the whiteboard and iterated.

HQ version of the new Portfolio: i.imgur.com/Qcwwlpq.png

We're now developing a more comprehensive portfolio section. It will have distinct tabs for Principal Token, Yield Token, and LP Position. Each position will have clear labels and a dedicated 'Manage' button for easy access to actions.

Tooltips and helpers are coming across flows and modules.

Given the early stage of interest rate derivatives in DeFi, it’s understandable that users want to be well-informed about their actions. We're introducing dynamic tooltips that provide transparent information about each action. For those who want a deeper dive, each module will have a 'Help' page linking to detailed documentation.

Yield Marketplace

Based on the feedback about the right sidebar, we are revamping one of the core products, the Yield Marketplace, into a centered layout that doesn't interfere with wallet notifications.

HQ version of the Yield Marketplace mockup: https://i.imgur.com/V2ZGSSN.png

The existing, simplified layout found in Fixed Rate and Yield Trading will still be present. The next rounds of feedback will help us decide whether a centered design should be applied to the remaining features.

Speaking of Lite and Pro modes for our interface, as we're still gathering feedback, our current focus remains on balanced UI catering to novice and experienced users.

Works on the Protocol

Many of the works at Spectra are dedicated to building a robust protocol, often unsexy and monotone stress-testing and bug-fixing marathons. Here are some of them:

• Stress testing contracts in various ways: stress-testing, fork testing, invariant testing, use of dynamic and static analysis tools etc. These contracts include routers, zaps, principal tokens, LP Vault, and more.

• Internal codebase migration

• Works on the Yield Marketplace indexer, UI & contracts

• Visualization stack for APRs (subgraph, standalone app, in-app charts)

• Internal audits

• New tokenomics & governance contracts

Research

• Extensive research on AMM parameters and pool behavior for different profiles of yield-generating assets

• Drafted governance proposals for protocol and governance re-launch

• Market Making for tokenized yield derivatives

Other

• Gaspard and Ulysse hinted that down the road, the engine powering Spectra’s APR charts would be used to power a standalone app for yield traders. ← This will be a part of the broader Spectra ecosystem.

• Educational thread on how Spectra’s Fixed Rate helps lenders, farmers, and stakers to lock in their future income

• Educational thread on how APR evolution can present greater return opportunities than price evolution, using Lido’s stETH as an example

The need for a permissionless interest rate derivatives protocol couldn’t be more evident in August 2023.

August highlighted the importance of having an open protocol for interest rate swaps. The DeFi community was buzzing when Curve Finance’s Founder took a big loan using his CRV assets. This move was made on several platforms, including Abracadabra Money. Things got heated with a proposal that could lead to higher interest rates for CRV loans.

Gaspard commented on the situation, pointing out the need for Spectra in DeFi.

EthCC

In July, Spectra showcased at The Ethereum Community Conference with its booth. It was our debut at a public event as Spectra. Attendees appreciated our new direction and were curious about how it differentiates from APWine.

A quick refresher on Spectra's core goals:

• Composable and permissionless approach to the protocol, which anyone can use for their own needs

• Delivering a cutting-edge, in-house flagship app that unlocks yield trading, fixed rates, upfront yield, and more for a wide range of DeFi’s interest-bearing tokens

• To empower the Defi ecosystem with extensive tools for interest rate derivatives

During EthCC, Gapard was interviewed by France's most popular crypto magazine Cryptoast, and also presented Spectra’s deck on one of the event’s stages.

What’s next?

Public Audits

As we approach Spectra’s mainnet release, the protocol's security remains our top priority. The next significant step is the public audits of our contracts, a critical measure to ensure the safety and reliability of the protocol.

The public audits will be conducted via Hats Finance and Code4rena - skilled 'hackers' worldwide will compete to identify potential vulnerabilities. This competitive approach is designed to maximize the chances of spotting any issues.

Reshaping Beta

In response to user feedback, we're refining the Beta version of Spectra. As highlighted earlier, we're experimenting with the new layout, starting with the Yield Marketplace. This enhancement will give users a clearer understanding of their actions, a comprehensive view of APR trends through interactive charts, and a detailed breakdown of their positions.

Documentation

Parallel to the Beta modifications, it's binding to update our documentation. This ensures that our users are consistently guided and supported at every step within the app, aligning with the latest features and functionalities.

Most of the following report contains Q2 2023 progress and developments undertaken while operating under the APWine name. Rest assured, these advancements are fully integrated and benefit the newly minted Spectra Ecosystem.

Without further ado, let’s dive into the key events.

The Rebranding & Opening Beta

On 10th July, Spectra was introduced as a project of dual nature - a permissionless protocol and its flagship interface. The news brought a refreshed attention to our project resulting in a decent following from large DeFi-Twitter accounts and various investment groups. Our community’s reaction to rebranding was 100% positive and supportive.

We are happy to see new community members interacting with each other on our refreshed Discord and providing us with more feedback on Beta. We are taking notes and taking action on the areas mentioned, such as a more detailed Portfolio breakdown and charts. Thank you to all of you who take the time to provide us with feedback as we build!

We also owe a big round of applause for this successful rollout to our trusted project partners and their community members, who were valuable contributors during APWine's era. You can find their logos on the rebranding video as well as on Spectra’s website 🙏

Opening Beta 🔑

Alongside the rebranding, we’ve opened the doors to Beta for everyone to experiment with features such as Fixed Rate, Yield Trading, LP Vaults, and to preview the long-awaited [Create Pool] feature.

A reminder of the importance of the [Create Pool] for Spectra protocol, which will allow for a permissionless pool creation for interest-bearing tokens with the ERC4626 standard.

Similar to how Uniswap popularized permissionless pools for ERC-20s which resulted in an explosion in DeFi trading volumes, we aim to replicate this impact for the growing landscape of ERC4626s. With this feature, Spectra can scale much more efficiently.

You can now glimpse this feature in Beta - beta.spectra.finance

Marketing/Comms

As we geared up for the rebranding, we decided to remain quiet to save the ‘ammunition’ for later use. Nevertheless, you could see our team shedding light on upcoming advancements, such as

• Detailed overview of the LP Vault model

• The nature of the Principal Tokens

• We’ve been vocal about the Pool Creation and its features

Collabs

Despite sunsetting APWine, we are proactively reaching out and interacting with protocols anticipating integration at Spectra’s launch.

One of the collaborations that we are particularly excited about is our work with the leading lending protocol. We believe that there is a great opportunity to create an efficient and UI-friendly interface for Fixed Rates on top of it, allowing their user base to leverage Spectra protocol under the hood seamlessly.

Sunsetting APWine 1.0

Mid-May, the last pools on APWine expired, effectively ending this protocol era. The APWine front end is still accessible for those who have not yet withdrawn their funds.

V1 remains operational for the foreseeable future.

Events

Throughout April & May, we’ve had Gaspard appearing on the main stages of well-known DeFi events with a strong focus on educating attendees about the importance of interest rate derivatives infrastructure and sparking interest in the features our project unlocks.

• DeFi Summit Prague - Role of Interest Rate Derivatives Beyond Yield Farming and Speculation

• ETHZurich - Redefining DeFi's Risk Management with Interest Rate Derivatives

• ETHDAM - ‘Building on DeFi’ Panel

• Brussels Blockchain Week - on DeFi’s Adoption

• Web3 Berlin - Exploring the Next Frontier in Decentralized Finance.

In late May, we hosted the 4th edition of Web3 DNA in Paris with Morpho, Paladin, Sismo and Aleph as sponsors. This time, the panel was led by the man himself Jerome de Tychey. As in all previous editions, the room was packed with enthusiastic DeFi users and we had a chance to strengthen our relationship with top French builders.

Overall, our strong presence and awareness in Europe, which we have built over the past years through our physical presence in events and community gatherings as APWine, will serve as a great foundation for Spectra to attract users and capital from this continent and beyond.

These days we are looking forward to attending EthCC and showcasing Spectra to the DeFi community. We'll be marking our presence at the event with a booth, an engaging speech from Gaspard, and numerous meet-and-greets with users and potential collaborators.

Be the first to meet Spectra IRL at our booth and Future of France event.

Tech

Under the hood, we are undergoing a new round of internal and external audits to ensure they are solid for the protocol’s official launch.

The smart contract team has been focused on improving the new version of the protocol, integrating revenue streams and groundwork to simplify UX integrations. We've also been fine-tuning the governance model and working on simulations for Spectra’s infrastructure.

On the app side, we've made several improvements to make it fast, easier to use and it being 100% decentralizable. Our effort is now on making Spectra’s flagship interface understandable by beginners and advanced users.

Docs

Documentation is the backbone of every Defi project, and we are dedicating resources to building in-depth and resourceful documentation. Its current state allows Beta users to learn about existing features, deep-dive into use cases with practical examples, or learn about Spectra’s primitives that make it all possible. More additions are on the horizon!

Please note that Spectra’s branding alongside the new $APW logo is yet to be reflected across crypto info aggregators. Don’t hesitate to ping us on Discord with less-obvious platforms that we should inform about the recent rebrand.

That’s it for Q2!

Make sure you’re up to date with Spectra by following us on Twitter and joining our refreshed Discord.

Spectra Team

I am proud to announce that we are entering a new era in DeFi's interest rate derivatives.

Everything we've hinted at with APWine 2.0 now comes together in the bigger picture of Spectra.

Below I'll dive into the why behind the rebranding, showing that APWine 1.0 was just the start of what Spectra can offer. Plus, I'll shed some light on the following milestones.

Goodbye APWine, Hello Spectra

It all started with the simple idea that one should be able to speculate on DeFi interest rates, and a group of French students then created the first yield tokenization protocol. That's where the name ‘APWine’ comes from. It quickly grew into a full-scale company with 12 full-time members working on an advanced IRD protocol and a more comprehensive range of tools.

Choosing to rebrand wasn't easy, but it was clear that APWine didn't cover everything we were building. And let’s not forget about the numerous situations when people in the Web3 community wrongly made the association with wine because of the meta we were using.

At first, the name APWine was fun and catchy, but in the long run, it held us back.

There’s much more o Spectra than just a new name.

This fresh start brings numerous changes on both protocol and product levels that foster permissionless composability with the existing DeFi infrastructure.

The Big Picture

Spectra focuses on a permissionless protocol architecture, a journey towards decentralization, and new financial possibilities, and features a flagship app that lets DeFi users use all the exciting features that the protocol unlocks.

Like Uniswap kickstarted the Cambrian explosion of liquidity pools for any ERC-20, Spectra’s architecture enables this for ERC-4626. This standard for interest-bearing tokens keeps growing, and big names like Aave V2/V3, Morpho, Yearn, and Balancer are already using it.

The Spectra Protocol lets anyone create a pool for any interest-bearing token compatible with ERC-4626, and this will be the leading feature where users or DAOs can create interest rate derivatives environments tailored to their needs.

There is no longer a need for a lengthy governance process like in APWine.

It's worth mentioning that at the moment, DeFillama is tracking over 9000 interest-bearing tokens with a total value of more than $1B. We strongly believe ERC-4626’s adoption continues, and Spectra will serve as a foundation to unlock new financial possibilities for them while also capturing fees for the protocol and liquidity providers.

So, what are these possibilities that a Spectra unlocks for interest-bearing tokens?

• Fixed Interest Rates (Discounted Tokens)

• Variable Rates (Yield Trading)

• Supercharged Liquidity Provision with up to 4 fee streams

• Yield Marketplace (Buying/Selling of specific yield tranches)

• Upfront Yield

• Lending/Borrowing

*Given the Beta stage, not all features are available today in Spectra’s flagship app.

Here's a rough timeline of events coming to the Spectra Ecosystem.

Today, we're launching the Beta to the public, which lets us gather more feedback as we prepare for the full release of the app.

Give it a try here → beta.spectra.finance

Next up is Yield Marketplace, a tool for more advanced users and organizations that allows for exchanging specific yield timeframes. This granular approach will position Spectra as the only place in DeFi to create custom yield strategies.

Read more about our unique design for tailored yield strategies here (with IRL examples!)

A word on composability & Spectra SDK

Even though the first V1 aimed to be composable, the reality was more complex in practice. Taking a lesson from this, Spectra is now fully compatible with the latest token standards, allowing permissionless protocols to integrate seamlessly and builders to participate in the development of the Spectra ecosystem.

With the SDK coming around the full app rollout, developers will have a full frontend library to interact with contracts.

Interfaces, relayers, aggregators, exchanges, asset-focused marketplaces, or risk trackers can all be built on Spectra.

I believe that collaboration and new ideas from outside the founding team are crucial. This is how we'll truly unlock the potential of Spectra and DeFi's interest rate derivatives sector.

On Token & Protocol Fee Models

APWine introduced the $APW token a couple of years back. It has been integral in fostering liquidity pools, fueling community initiatives and shaping governance decisions.

As we enter the new chapter, $APW will remain at the core of the Spectra ecosystem.

As Spectra picks up steam, we're pondering a shift to a new ticker.

This new chapter will allow us to update core mechanisms and integrate advanced standards and optimizations into the token. This 'tokenomics refresh' will occur in stages, starting with the launch of Spectra, and will be coordinated with the DAO.

During this transition, we are committed to ensuring stability and continuity for all APW stakeholders and those who have their APW locked up.

In the meantime, we're crafting governance proposals tailored to align incentives better and enhance our governance model to match the protocol's growth. Expect to see these proposals for community review and input in the near future.

Now, let’s talk about fee models planned for Spectra.

The key innovation areas in protocol fees models include:

• Tokenization Fee - We chose not to have a custom AMM in Spectra, instead relying on the efficiency and composability of existing solutions (starting with Curve). This means we won't be taking fees directly from these AMMs. The protocol will benefit from its "usability” by charging a fee for the tokenization process.

A portion of the protocol fees will go back to the pool creator, which should encourage the creation and organic promotion of the pools.

• Withdrawal Fee - Our updated design includes a fee for LPs when they withdraw, which decreases linearly as the vault's expiry gets closer. This design encourages LPs to keep their positions in the vault for longer, penalizes farmers who only enter and exit for the rewards, and helps the protocol gather a wide range of assets and generate passive revenue.

• Trading Fee - Applied to trades on Yield Marketplace

In addition to Tokenization and Withdrawal fees, we have several other fee-generating mechanisms in the pipeline.

We're also actively working on defining the allocation structure to decide how these fees will be initially shared among LPs, DAO, and token stakeholders. These protocol fees will be iterated with the community.

Expect a dedicated article where we elaborate more on fees and protocol revenue models.

Moving on, I'd like to say a few words on Spectra's path to decentralization.

Path to decentralization

Achieving decentralization isn't a sprint; it's more like a marathon. The rules of the game are still being figured out and tested thoroughly. In the coming weeks, we will share a roadmap that lays out the milestones we aim to achieve and how to get there with the community.

Lending & Borrowing

Spectra's Principal Token represents the right to a fixed amount of the underlying asset (like USDC) when it expires. This opens up opportunities for lending markets where Principal Tokens are used as collateral.

Though it's still a work in progress, I'm thrilled to let you know that we've teamed up with the biggest players in the lending sector to bring such a platform to Spectra Ecosystem. The ability to use Principal Tokens as collateral is a natural next step in Spectra's evolution.

What Happens to APWine & $APW?

As we transition to the new brand, Spectra, I want to assure our community that existing APWine websites and services will remain fully functional for the foreseeable future. We will carefully communicate each transition step in future announcements.

Users can continue accessing and exiting positions on apwine.fi until we phase it out.

Closing Remarks

Spectra is more than just a rebranding of APWine; it is a powerful manifestation of our vision for the future of DeFi. It carries the lessons learned, experiences gained, and the continuous drive for improvement.

To the APWine community, thank you for your persistent trust and support.

To those just discovering us, we invite you to explore what Spectra has to offer and join us in shaping the future of decentralized finance.

That's it for today! Keep an eye out for updates at @spectra_finance

Gaspard and Team