Analyst Insight

By examining the on-chain metrics for USDbC on Compound V3, our risk model classifies this as a standard market performer, aligning with the broader Base lending average.

The current APY of 1.40% is supported by a Total Value Locked (TVL) of $82,004. This pool is currently trading 26.7% below the category average. This yield compression often occurs in under-utilised markets.

Risk Context: With a Safety Score of 66/100, this liquidity pool is positioned for active yield farmers monitoring daily volatility.

Yield Mechanics: How It Works

Understanding the underlying engine is essential for assessing sustainability. The 1.40% APY displayed for USDbC is primarily derived from interest paid by borrowers on the Compound V3 protocol.

Supply & Demand

When you deposit USDbC, you become a liquidity provider. Borrowers pledge collateral (like ETH or BTC) to take out loans. The interest rate fluctuates based on the Utilisation Rate (currently 35.03%). With moderate utilisation, rates remain stable, ensuring liquidity is available for withdrawals.

Risk Strategy & Management

While Compound V3 is a reputable protocol, no yield is without risk. Based on the current Safety Score of 66/100, the following approac may suit (DYOR):

• Smart Contract Risk: Ensure you are comfortable with the audit history of Compound V3.
• Liquidity Risk: With a TVL of $82,004, slippage is a potential concern for whales.
• Strategy: Monitor weekly. Consider diversifying across multiple chains to mitigate protocol-specific risks.

Frequently Asked Questions

Advanced Tools

Enhance your stablecoin yield data analysis with our suite of tools:

• Profit Calculator: Forecast compound interest earnings.
• Safety Audit: Deep dive into the risk factors.
• Liquidity Depth: Analyse market dominance and slippage.