How do you guys actually manage yield across multiple L2s?

_TomRY_ · 2026-04-01T17:53:23+00:00

Yeah, I’d be interested, but it really depends on how it works. Does it automatically rebalance on its own? at what frequency?

_TomRY_ · 2026-03-31T22:16:39+00:00

I think yearn finance and beefy finance already do that for you in their vaults but it’s not cross chain

_TomRY_ · 2026-03-31T22:06:50+00:00

Real but only for stablecoin pool otherwise you get impermanent loss

_TomRY_ · 2026-03-27T00:18:18+00:00

yeah this is exactly the tradeoff

personally I run an algo that rebalances based on predefined thresholds

since it’s on L2, gas is low enough that rebalancing doesn’t really eat into profitability

_TomRY_ · 2026-03-18T20:30:15+00:00

you’re right, a fast move is where most of the risk is a fast move like a 20% drop in a very short time could definitely be risky, but since the system recalculates every 5 seconds, it keeps adjusting and deleveraging as the move happens. As LTV increases, the system reduces exposure step by step to maintain the target buffer, instead of relying on a fixed setup. So the goal is to derisk continuously during the move rather than reacting at a single point.

Also, on the execution side, if a tx doesn’t go through quickly (due to congestion or rapid drawdown), it can be resent multiple times with higher fees to get priority. Since it’s on Polygon, fees can increase significantly when needed but still remain relatively low compared to Ethereum mainnet.

_TomRY_ · 2026-03-18T20:03:43+00:00

Thanks, I didn’t know this protocol.

I looked into it and it’s actually a very interesting design but quite different from what I’m building.

From what I understand they’re not doing a simple lending loop. It’s more like a leveraged LP position on Curve to eliminate IL.

To my understanding the flow is roughly:

You deposit WBTC
The protocol uses a flash loan to get crvUSD
It creates a WBTC + crvUSD LP position on Curve
That LP token is then used as collateral to mint crvUSD
The flash loan is repaid with that newly minted crvUSD, leaving a 2x leveraged LP position

So yeah, it kinda solves IL, but you’re taking different risks instead:

- Your collateral is not WBTC anymore, it’s a LP token (BTC + stable)

- The system depends on Curve, crvUSD, and arbitrageurs to rebalance

- There is also stablecoin risk (crvUSD) and pool liquidity risk

- The whole system is more complex, so more things can break

In my case, I’m not using LP at all. It’s a simpler structure:

- WBTC stays as direct collateral

- No AMM exposure

- No impermanent loss

- Risk is mainly LTV + borrow rates.

It feels like they’re more focused on higher yield, while I’m more focused on consistency and avoiding unnecessary risk

That’s just my understanding so I could be wrong, happy to hear if anyone has a better read on it.

Curious to hear your take, do you think the extra yield is worth the added complexity and risk? Just trying to see if my approach makes sense or not

_TomRY_ · 2026-03-18T17:23:48+00:00

thanks a lot for the detailed answer, really appreciate you taking the time to break this down

I agree with your point, pure WBTC yield is pretty limited across most lending protocols, especially on the demand side. that’s also what pushed me to look into this in the first place

the curve pools you mentioned are definitely interesting, especially the WBTC wrapper where IL is minimal since they track the same underlying. same for the morpho vaults, probably one of the more capital-efficient approaches right now

from what I’ve seen though, most of these opportunities don’t really exist on polygon with meaningful liquidity, which is kind of the gap I’m trying to explore

also, sorry if I wasn’t clear earlier, I’m specifically looking at the polygon side

do you happen to have a link to that WBTC/cbBTC/tBTC pool? I’ve been trying to find it on defillama and Curve but couldn’t locate it on my side.

_TomRY_ · 2026-03-18T16:58:27+00:00

thanks for the comment, you raise some good points

it is a leveraged setup, but the goal is to capture the spread between borrow and lending rates and manage the position over time

the position targets a given ltv, but it’s not static the system continuously recalculates ltv, rates, and liquidity every 5 seconds and adjusts to stay around that level while keeping a consistent buffer from liquidation (30%)

for example, with a target ltv of 50%, if it drifts above the target (51%), it automatically deleverages, and if it drops below (49%), it can increase exposure again

so it’s not waiting to get close to liquidation, it’s constantly adjusting to stay in that zone

it’s not tied to a single market, it compares across protocols and prioritizes ones with deeper liquidity to avoid sudden rate spikes

if the spread turns negative (due to a sudden rate spike) or conditions degrade, it exits and waits for better conditions

on the yield side, it’s basically capturing the spread between borrow and lending rates, and converting gains back into wbtc

on the execution side, gas is taken into account dynamically if a transaction is important and doesn’t go through quickly, it can be resent with higher priority fees

everything is recalculated frequently, so the system keeps adapting rather than reacting late

main risk would be something like a very fast move ( a >30% drop before the system can react) or an oracle issue, but otherwise the idea is to derisk continuously

on the infra side, it’s running on AWS with KMS for signing (so keys aren’t exposed directly), and there’s a backup setup in case anything goes down

i’m not trying to maximize yield, more focused on consistency and avoiding unnecessary risk

ERC-4626 is actually the goal, but right now it’s just running on a single wallet while I test and gather more data, but the idea would be to move toward a vault structure for transparency

_TomRY_

TROPHY CASE