C-Tokens; Derivatives Yield for LRTs

Michael Spain -

Today, Derive, is pleased to announce the launch of a new covered call strategy using rswETH from Swell and weETH from EtherFi as collateral. This program offers ETH holders a sustainable way to generate additional income through an automated, tokenized strategy. This will be the first of many strategies implemented from Derivatives Yield on Eigenlayer.

Full details:

  • Deposits for this strategy will open on May 21, 2024, at 12:00:00 AM UTC and will continue for the full extent of the airdrop period.
  • The strategies will start executing to earn sustainable yield from selling covered calls in the near future.
  • Earn 30 DRV points per hour per weETH or rswETH deposited; uncapped.
  • Users can deposit rswETH and weETH with more to come: derive.xyz/yield.

Automated Yield

By depositing rswETH or weETH into Derive, users can mint yield-bearing tokens that automatically execute the covered call strategy. This strategy involves selling call options on the deposited assets, allowing users to earn yield through options premiums. The annualized yield from this strategy ranges from 10-50%, and the automated process simplifies execution, making it accessible to all users. Additionally, the strategy stacks multiple sources of yield, including:

  • ETH staking rewards
  • EigenLayer points
  • Re-staking points
  • and DRV points

For more details on the full strategy, execution and risks associated with Covered Call LRTs visit our documentation.

DRV Airdrop Program

On top of the derivatives yield, users also earn DRV points as part of the airdrop program. This program rewards users with additional DRV points, boosting their overall yield. Participants will also continue to earn points from Swell and EtherFi, further enhancing the value of their participation. The combination of these rewards ensures that users maximize their returns from multiple sources while contributing to the growth of the ecosystem.

Conclusion

Covered calls are a powerful and sustainable strategy for generating yield on ETH assets through options selling. Derive's tokenized strategy vaults allow users to execute this strategy with liquid restaked tokens (LRTs) as collateral, simplifying the process and maximizing yield potential.

Stay tuned for more products and bonus incentives from EtherFi, Swell, and other partners.

Derive is the infrastructure layer for DeFi derivatives, visit derive.xyz.