YieldFest Part 4: Gnosis Chain Deployment Brings Two New Yield Sources to Hyperdrive
Hyperdrive has been deployed to Gnosis Chain, along with two initial yield sources: wstETH and Savings xDAI (sDAI).
We’re officially in the fourth week of YieldFest, with more great news to share. We’ve already announced integrations with rETH and sUSDe/DAI, ezETH and USDe/DAI, wSTETH/USDC and ether.fi’s eETH. Today, we’re excited to announce that Hyperdrive (developed by DELV; this instance operated and managed by the Element DAO) has been deployed to Gnosis Chain, along with two initial yield sources: wstETH and Savings xDAI (sDAI).
“Hyperdrive’s deployment on Gnosis Chain marks another major milestone for the protocol as it continues to expand and diversify the yield opportunities available to users,” said Charles St. Louis, CEO of DELV. “These additions will help grow the platform and empower the Hyperdrive community to explore innovative strategies that align with their financial goals. We’re committed to providing the tools to make it possible for everyone to use DeFi.”
What is Savings xDAI (sDAI)?
Savings xDAI (sDAI) is a yield-bearing version of xDAI, the stablecoin native to the Gnosis Chain, a highly secure, resilient, and decentralized EVM-compatible Layer 1 network. Gnosis Chain is a community-owned network operated by a diverse set of more than 200,000 validators worldwide. Gnosis uses the same architecture as Ethereum and is committed to contributing to the research, engineering, and tooling for Ethereum's stack.
xDAI is designed to be pegged to (but not backed by) the U.S. dollar, whereas Savings xDAI represents xDAI that has been staked in the DAI Savings Rate (DSR) module, which distributes revenue from the Sky Protocol to DAI holders. When a user holds Savings xDAI, they may earn interest over time if the value of Savings xDAI appreciates relative to xDAI.
Hyperdrive’s deployment on Gnosis Chain will enable users on Gnosis to participate in Hyperdrive markets for locking in a predictable fixed rate, getting multiplied exposure to the variable rate, or provide liquidity to get trading fees and yield on idle capital.
How to get started with Savings xDAI on a Hyperdrive pool
If you’re a liquidity provider, using Savings xDAI is simple. Here’s what you can do:
- Acquire Savings xDAI by converting xDAI, or purchase it through an exchange like Balancer V2.
- Access the Hyperdrive app.
- Deposit your Savings xDAI by navigating to the LP tab.
- Earn yields through Hyperdrive's optimized liquidity pools.
And if you’re a trader, here’s how it all works:
- Acquire Savings xDAI by converting xDAI, or purchase it directly through an exchange like Balancer V2.
- Access the Hyperdrive app.
- Deposit eETH on Hyperdrive.
- Open a long position at a fixed rate or a short position at a variable rate.
What is wstETH?
wstETH is a version of stETH that has been wrapped to create a fixed-balance token. Unlike stETH, where the balance changes due to rebasing, wstETH is designed to maintain a constant balance, and its value may increase as staking rewards are earned.
It’s also an ERC-20 token that’s compatible with a wide range of DeFi protocols, and can be used for lending, borrowing, trading, and providing liquidity, all while maintaining exposure to ETH staking opportunities.
How to Get Started with wstETH on a Hyperdrive pool
If you want to provide liquidity, here’s how it works:
- Acquire wstETH by converting your stETH into wstETH, or purchase it directly through an AMM like Uniswap, Matcha, or CoW Swap.
- Access the Hyperdrive app.
- Deposit wstETH on Hyperdrive by navigating to the LP tab.
- Earn yield with wstETH staked on Hyperdrive. You’ll gain returns from staking and trading fees.
And if you’re a trader, here’s what you can do:
- Acquire wstETH by converting your stETH into wstETH, or purchase it directly through an AMM like Uniswap, Matcha, or CoW Swap.
- Access the Hyperdrive app.
- Deposit wstETH on Hyperdrive.
- Open a long position at a fixed rate or a short position at a variable rate.
YieldFest is far from over, so stay tuned for more exciting announcements about new yield sources.
Missed our earlier posts? Check out Part 1, Part 2, and Part 3 to learn about our other integrations. Plus, take a look at our YieldFest kickoff announcement for more details (including our role as a non-exclusive service provider to the Element DAO).
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Note: This blog post is general in nature and for informational purposes only. It is not legal, tax, investment, financial or other advice, nor is it a comprehensive or complete statement of the matters discussed. It is not a recommendation of an investment strategy and should not be used as the basis of any investment decision.
All transactions and investments involve risk, and past performance does not guarantee future results. Certain complex strategies carry additional risk and are not appropriate for all users. As with any DeFi or crypto position, you may incur losses. You alone are responsible for evaluating the benefits and risks associated with any decision to use Hyperdrive and the risks or concerns with any underlying yield source.
Hyperdrive is not currently available in certain jurisdictions, such as the USA and the UK.