Mezzanine is an automated DeFi investment manager where you deposit funds, choose a risk tier, and its vault runs a leveraged yield strategy for you. The first strategy, the…
Original source excerpt
Mezzanine is an automated DeFi investment manager where you deposit funds, choose a risk tier, and its vault runs a leveraged yield strategy for you. The first strategy, the Hastra Optimizer, is, in …
Mezzanine is an automated DeFi investment manager where you deposit funds, choose a risk tier, and its vault runs a leveraged yield strategy for you. The first strategy, the Hastra Optimizer, is, in simple terms, a looping strategy split into lower-risk (Senior) and higher-risk (Junior). Let's say you invest $10,000. The vault borrows another $10,000. It now holds $20,000 of assets earning 9.79%: $1,900 annually. Interest on the $10,000 borrowed at 6.2% costs $620. Net income is $1,280, or 12.8% on your original $10,000, before fees. Okay, so what's the risk here? Well, the borrowing cost might go higher than the interest rate paid out, if so, you lose money. This is where the Junior/Senior comes in. If there are days/weeks with a negative spread, then people who chose the Junior APR (21%) will eat the loss until the pool is empty. Think of @mezzanine_fi as an automated, leveraged credit fund in DeFi that handles borrowing, reinvestment, and withdrawals, adjusts leverage as conditions change, and allocates returns and losses across different risk tiers.
AI context is not available for this statement. The original source can be read independently.