The appearance of EigenLayer restaking has opened up new yield alternatives for Ethereum holders. A handful of protocols now present liquid restaked ETH, juicing returns for individuals who know the place to look.
A brand new product from Index Coop goals to bundle these yields into an index token for straightforward entry and built-in diversification.
The Excessive Yield ETH Index (hyETH) set to launch subsequent month, combines right into a single token 5 yield methods that meet minimal APY and complete worth locked (TVL), amongst different standards, utilizing open-source, audited protocols.
To check demand for such a product, Index Coop devised a points-inspired bootstrapping mechanism known as Product Income Tokens (PRTs).
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Index set a 30-day purpose of 500 wstETH (Lido wrapped staked ether) on April 8 — about $1.8 million — on the time, however blew by that focus on in lower than a day. After reaching the minimal to launch hyETH, deposits have since doubled.
“It has exceeded our expectation,” the ecosystem progress lead at Index Coop, who goes by Crews.eth, instructed Blockworks.
PRTs can solely be earned by depositing into the hyETH pre-sale contract, and received’t be distributed till the product launches.
“It’s positively impressed by the recognition of level programs, however we want to provide individuals an actual ERC20 token on-chain quite than simply holding factors in an off-chain database,” Crews stated. “And we want to direct actual yield from product income to the holders of these PRT tokens.”
As with many initiatives to supply structured merchandise on-chain within the wake of Securities and Change Fee enforcement actions, Index Coop merchandise are solely out there to traders exterior the US.
Index plans to distribute 30% of the ten,000 PRTs to contributors within the hyETH presale, with the remaining 70% going to the Index Coop Treasury.
Prior product launches have tended to share income 60/40 between the coop and a methodologist companion, just like the DeFi Pulse Index (DPI).
Index then used its personal governance token (INDEX) to incentivize liquidity into its merchandise.
“Individuals require social proof once they need to deposit into a brand new product, so it’s actually good to not have a product that, like, struggles to interrupt by that first million {dollars} deposited,” Crews defined.
Nevertheless it discovered that the partnership mannequin was finally unsuccessful, Crews stated, citing for example the Bankless BED Index, which has fewer than 800 token holders and $800,000 in TVL, in line with Etherscan.
The cooperative nonetheless plans to finally direct protocol income to INDEX holders, however solely after constantly breaking even, he stated.
PRT holders should stake their PRTs to share within the income of the brand new product post-launch.
“Customers need to see and know that they’re being rewarded for his or her contributions and utilizing a protocol,” Crews stated. “You need the consumer to grasp that you simply respect them being an early mover, an early adopter and risking their capital into an up-and-coming product.”