Impermanent loss a static 2x LP would suffer (that rebalancing avoids)
Análise completa
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Three separate return components, not one number
It's tempting to read "2x leveraged BTC LP with no impermanent loss" as one simple yield figure, but YieldBasis's actual return is the sum of three genuinely separate mechanics. First, LP fee income: because the position is permanently 2x leveraged, you earn roughly double the trading-fee APY of the underlying BTC/crvUSD Curve pool on your equity — that's the calculator's main APY line. Second, borrow cost: the crvUSD you're implicitly borrowing to hold that 2x position accrues interest at a YieldBasis-specific rate (2× the base rate for yb-WBTC, currently near 2.64%/year), which is subtracted straight from the fee income.
Third — and this is the part that's easy to conflate with the other two — is the rebalancing mechanic itself. A static, never-rebalanced 2x leveraged LP position would accumulate impermanent loss as BTC's price diverges from your entry point, following the same constant-product-AMM math that affects any leveraged LP. YieldBasis's rebalancing AMM and virtual pool continuously nudge the position's debt-to-value ratio back toward 50% as price moves, which is what prevents that IL from compounding the way it would in a static position — the "IL avoided" section below shows you exactly how large that avoided loss would have been for a given price move, using the standard constant-product IL formula as the static-position baseline.
Perguntas frequentes
What is YieldBasis and how does ybBTC avoid impermanent loss?
YieldBasis (built by Curve's founder) issues ybBTC as a claim on a permanently 2x-leveraged BTC/crvUSD Curve LP position. A dedicated rebalancing AMM plus a virtual pool continuously incentivize arbitrageurs to keep the position's crvUSD debt at roughly 50% of the position's value — as BTC rises the protocol borrows more crvUSD to reset leverage back to 2x, and as BTC falls it repays debt to restore the ratio. That continuous rebalancing back to a constant leverage target is what avoids the impermanent loss a static (never-rebalanced) leveraged LP position would accumulate as price diverges from its entry point.
What are the actual fees on a YieldBasis position?
For the yb-WBTC market, the crvUSD borrow (refuel) rate is set at 2× the base rate — reported at roughly 2.64%/year (2 × 1.32%) — reflecting that a 2x leveraged position borrows against roughly half its notional value, and the underlying Curve crypto pool charges an AMM trading fee around 1.82%. Half of all trading fees earned by the pool, plus the borrow-rate interest collected, fund a dedicated rebalancing budget that pays arbitrageurs to execute the trades keeping leverage on target; the other half of trading fees is split between unstaked ybBTC holders and veYB (DAO) stakers via a dynamic admin fee that shifts toward stakers as more ybBTC gets staked.
Is ybBTC truly impermanent-loss-free, or just IL-reduced?
It's continuous rebalancing toward a fixed leverage target, not a magic elimination of the underlying AMM math — the position still trades inside a Curve crypto pool that has its own bonding curve, and rebalancing itself has a cost (paid from the fee budget) that scales with price volatility and trade frequency. What genuinely changes versus a static leveraged LP is that YieldBasis never lets debt-to-value drift far from 50% the way an un-rebalanced position would, so the compounding IL curve that punishes static leveraged LPs as price moves away from entry doesn't build up the same way here — think of it as IL-resistant by design rather than IL-immune in every market condition.
What's the difference between YieldBasis and a leveraged token (like a 2x BTC token)?
A leveraged token rebalances to a fixed leverage target on the price of the underlying asset alone and has no LP fee income — its whole return comes from price movement, and daily rebalancing on a leveraged token creates its own well-known volatility-decay drag. YieldBasis is rebalancing an LP position (which itself earns trading fees from the BTC/crvUSD pool) back to a fixed debt-to-value ratio, so its return has three separate components: 2x exposure to the LP fee income, the rebalancing/IL dynamics of the underlying pool, and the crvUSD borrow cost — a structurally different combination than pure price-leverage products.
What risk does a YieldBasis LP still carry?
Smart contract risk across the whole Curve/YieldBasis stack, crvUSD peg risk on the borrowed side, oracle risk feeding the rebalancing AMM, and rebalancing-budget risk in genuinely extreme volatility — if price moves faster or more violently than arbitrageurs can profitably rebalance, the position can temporarily drift from its 2x target, and the fee income funding the rebalancing budget could underperform the cost of the trades needed to restore it. None of this is modeled as a liquidation the way a standard leveraged position has one; it's closer to a persistent tracking-error risk during volatility spikes.