Native Yield
Yield Modes

Yield Modes

Rebasing Mechanism

ApeChain's yield-bearing tokens, such as apeUSD and apeETH, support a rebasing mode where users’ balances increase periodically in line with the yield generated by the underlying assets. For example, apeUSD balances will grow in real-time with sDAI yield, reflecting the underlying DAI accrual on Ethereum.

Scaling & Security

Aspect | Details

AspectDetails
ScalabilityThe on-chain logic for yield routes is generalized, allowing it to scale efficiently with increased volume and new yield-bearing tokens.
SecurityYield-bearing tokens are pegged to underlying rebasing assets, ensuring no risk of undercollateralization (e.g., 1 apeUSD = 1 sDAI).
Security DependenciesSecurity relies on the underlying smart contract risk of yield protocols and the Decent wrapper.
Messaging SecurityMessaging between chains is managed securely via LayerZero.

Canonical Bridging

ApeChain will utilize two canonical bridge routes:

Bridge RoutePurpose
LayerLeapFor native yield from Ethereum.
Standard OrbitFrom Arbitrum, offering an alternative for bridging, especially for non-yield-bearing ERC20 tokens.

Basic and Non-Functional Requirements

Functional Requirements

RequirementDetails
Supported AssetsUsers can deposit APE, USD stablecoins, and ETH on ApeChain to generate native yield.
Rebasing ModeAll yielding assets must support rebasing, ensuring users do not need to manually claim their yield.
Cross-Chain Deposits/WithdrawalsAssets can be deposited from and withdrawn to Ethereum mainnet.

Non-Functional Requirements

RequirementDetails
Decentralized Yield SourcesYield must be generated from credibly decentralized sources.
Decentralized System ControlThe yield system's operation and governance must be decentralized.
APE Yield via ApeStakeThe current ApeStake mechanism will be used to generate yield for ApeCoin without modifications.
Risk ManagementThe system should not expose users to risks beyond the inherent smart contract risks of the underlying protocols.

Yield Sources and Mechanisms

Yield TypeMechanismGovernance
DAI YieldStablecoins bridged into ApeChain are converted to DAI and deposited into sDAI, accumulating yield based on the MakerDAO savings rate.Governed by DAI’s governance processes.
Lido Yield (ETH)ETH bridged into ApeChain is deposited into Lido to generate yield, utilizing wstETH to align with rebasing token behavior.Due to Lido's withdrawal delay, users can either swap Lido ETH to native ETH via a DEX aggregator or withdraw as stETH directly.
Ape YieldApeCoin deposited into ApeChain is staked via ApeStake, with yield distributed based on the user’s share of tokens in the pool.Yield must be claimed via a discrete contract call, managed by the bridge contract.

Yield Accounting and Governance



Rates

These rates current as of November 18th 2024
TokenYield Rate
APE11%
ETH2.5%
USD6%

Rebasing Modes

ApeChain will support three configurable rebasing modes for yield-generating tokens:

Rebasing ModeDescription
VoidNo yield is earned; the balance remains unchanged.
AutomaticThe balance automatically increases as yield is earned.
ClaimableYield accumulates separately and can be claimed, but the balance remains unchanged.

Conclusion

ApeChain’s native yield system represents a significant advancement in the space, providing a decentralized, automated yield mechanism for bridged assets. By leveraging established protocols, ApeChain ensures sustainable yields and user-friendly operation through careful governance. This spec overview should serve as a guide, enabling developers and users to effectively interact with the native yield system as ApeChain continues to evolve.