Unit 3 · Level 3 · Stablecoins & yield
The yield checklist
Back in League 1 you learned the mantra: always ask where the yield comes from. That question would have saved every Anchor depositor. Now upgrade it to a checklist: What's the source? What token is it paid in? How fast does the APY melt as money piles in? Do impermanent loss and gas eat the profit? Run those four before your money moves, not after.
Free to play. No ads, no token, no account needed to start.
What you get asked
A farm advertises 2% per week. As a simple annual rate (2 × 52 weeks), what percentage is that?
104% per year. A number that high is a smell test in itself: real fee or interest income almost never pays that; emissions almost always do.
That 104% farm pays rewards in its own token. What usually melts first?
The APY is quoted in a token under constant sell pressure from the very people earning it. Sticker says 104%; the token chart says otherwise.
Run the yield checklist in the right order:
Source first, sizing last. Most yield disasters fail step one: the depositor never knew who was supposed to be paying them.
High yields tend to ___ as more capital piles into the same opportunity.
Same fees split among more depositors means a smaller slice each. Yesterday's screenshot APY is not tomorrow's, because dilution is built in.
Which is the best sign of a SUSTAINABLE yield?
Sustainable yield survives the subsidy ending; melting yield IS the subsidy. If the answer to 'where does it come from?' is real usage, you've found the rare good kind. 🐜
The rest of this unit
Every APY has a source: fees, borrowers, or freshly printed tokens.