Phuture and Notional are giving the blood red crypto markets a splash of green.
Phuturea passive income-generating DeFi protocol, launched its new agricultural yield product called “USV” (USDC Savings Vault) with “guaranteed” premium returns.
USV, a ERC-4626 compliant vault, uses Circle’s USDC stablecoin as its underlying collateral, allowing investors to earn interest on their holdings.
A decentralized finance vault (Challenge) represents an automated yield-generating smart contract. Instead of manually moving money from different projects to seek the best return, the smart contract does the hunting for you.
Investors can deposit their USDC to USV using the Phuture app and receive vault shares representing their investment. Vault stocks are self compounding and gain value over time based on the yield forged by the Vault.
Phuture has partnered with Notional, a fixed-rate lending DeFi protocol, to power its newly launched vaults. By data of Llama ChallengeNotional has a Total Locked Value (TVL) of $86.5 million at the time of writing.
Investors’ USDC deposits are directly used to purchase notional bonds with fixed rate yields. “To provide a stable long-term return, we have partnered with Notional,” said Phuture’s chief growth officer, Charles Storry. Decrypt. “USV essentially holds a portfolio of notional fixed rate bonds with different maturities.”
CEO and co-founder of Notional Teddy Woodward said Decrypt this “When you lend on Notional, your capital is not “locked”, but your rate is locked until maturity. We offer 3-month, 6-month, and 1-year maturities on stablecoins and roll these maturities quarterly.”
When investors want their capital back, the shares in the vault are later burned. Interest and collateral deposited are then returned to investors.
USV does not have a lock-up period for investors; the withdrawal can be made at any time after the investment.
Fixed rates for gain
A key advantage that Phuture enjoys comes from Notional’s fixed-rate loan protocol. Unlike variable rates on lending protocols like Aave and Compound, Notional’s lending and borrowing rates don’t change over time.
As of this writing, theoretical USDC bond yields (similar to Phuture’s USV yield) are 2.5% and 3.25% over three and six months, respectively.
“USV is not currently allocating capital outside of Notional’s platform,” Storry said. Decrypt “We reallocate assets in another case, when our bonds expire and must pass to the next maturity. USV will always allocate them to the highest yielding maturity available on Notional.
After Phuture, Woodward explained that Notional would also soon be linked to Index Coop, another passive investing DeFi protocol, and SpoolFi, a customizable yield-producing app.
Phuture (PHTR), the native token powering the protocol, has gained a modest 2.56% in the past 24 hours and is trading at around $0.02, per data from CoinMarketCap.
As of this writing, Phuture has a TVL of just over $520,000, according to data from Llama Challenge.
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