Michael Egorov Launches Yield Basis: A New Era for Sustainable Yield
Michael Egorov, the founder of Curve Finance, has introduced Yield Basis, a decentralized protocol designed to deliver sustainable yield while addressing impermanent loss (IL), one of the most persistent issues in decentralized finance.
Bitcoin holders have historically encountered limited options for on-chain returns. Lending markets often provide only a small fraction of a percent, while automated market maker (AMM) pools expose users to IL — the risk of losing value when token prices move apart. Even in the best scenarios, yields seldom exceeded 1–2%.
How Yield Basis Addresses Impermanent Loss
Yield Basis seeks to overcome this challenge by reengineering the AMM model. The protocol completely eliminates IL risk, which Egorov claims will facilitate deeper on-chain Bitcoin liquidity and create more appealing yield opportunities for institutional and professional investors. To support its initial growth, three pools were launched with a $1 million deposit cap each.
This system leverages Curve’s five years of robust infrastructure, incorporating a vote-escrow mechanism (veYB) for governance. In order to participate in governance and earn protocol fees, token holders are required to lock their YB. These fees are distributed in either Curve’s crvUSD stablecoin or wrapped Bitcoin. Unlike many DeFi projects, token emissions are not merely given to liquidity providers; they are linked to position yield, a model Egorov describes as “value-protecting.”
Yield Basis has successfully raised $5 million in early 2025 funding and is the inaugural project to launch on the joint Legion and Kraken launchpad, allowing the community to engage in its token sale. Though Bitcoin is the primary focus, Egorov mentions that the protocol’s impermanent loss solution could be applicable to Ethereum, tokenized commodities, or even stocks — which could significantly expand the range of yield-bearing assets on-chain.
