Build a CRV vault which gains yield from both the veCRV lock and also claims a small percentage of boosts to all bitcoin/stablecoin curve pools. Designed this way, this CRV vault would in theory be even higher yield than CRV locked directly as veCRV on Curve.
veCRV is the critical advantage that Yearn can have in providing stablecoin/bitcoin depositors across several Yearn vaults with boosts in yield, and a serious amount would also be an insurmountable moat against yearn competitors who are using Curve for yield. YFI could pool CRV into the 4 year lock veCRV then directly receive the veCRV holder APY (at time of writing 275% APR). However, on top of this the CRV vault depositors would also receive a percentage, say 5%, of the boosts to all the other Yearn vaults which use Curve. The depositors of stablecoins/bitcoin in other vaults will be happy as they have a higher boost due to increased veCRV boost. The depositors of CRV will be happy as they have an even higher return on their deposit than veCRV locked directly on Curve. The Yearn CRV vault would have a higher yield than the direct Curve lock, and could grow to become the biggest $veCRV owner. There is one major challenge - this pool would not be as liquid as a regular vault due to the 4 year $veCRV lock on the capital. Strategies around this may be implementing some sort of lock at the Yearn vault level, or other restricted withdrawal limits.
Optimal use of Curve remains the key yield farming strategy for several pools today. Yearn needs a huge and growing pool of locked veCRV to support high yields across multiple vaults as deposits of stablecoin and bitcoin increase.
- Establish yCRV vault with either restricted withdrawals or locks.
- Gain yield from both veCRV 4 year lock return as well as a small percentage (5%?) of all boosts to stablecoin and bitcoin curve vaults.
- Better yield for CRV even relative to Curve direct.
- Better yield for all stablecoin and Bitcoin yearn vaults through the boost.
- A massive veCRV pool provides a major competitive sustainable advantage for Yearn for all yield strategies that use Curve.
- Now is the optimal timing as the veCRV rewards start getting released in next few days.
Challenge of dealing with liquidity assuming most CRV will be in the 4 year lock.