Strategy Name: IronClad ETH Vault (ynETHx)
Selected Category: ynETH MAX (ynETHx) – Ethereum-based strategies
IronClad ETH Vault is a security-first, principal-protected ETH restaking strategy that allocates to only high-liquidity, insured, and thoroughly audited protocols. It uses a real-time smart monitoring system to assess risk levels and auto-rotate assets out of risky positions while maintaining exposure to the top-performing LRTs like stETH, ezETH, and swETH. An embedded “Safe Mode” automatically converts assets to ETH or stablecoins if severe depegs or protocol threats are detected. It’s a yield strategy designed to never lose capital, making it ideal for conservative users or DAO treasuries.
PROTOCOL’S RISKS:
• Smart Contract Risks:
Risk from code exploits or bugs in restaking platforms; mitigated by integrating only audited protocols with live risk scoring and insurance (e.g., Nexus Mutual, Sherlock).
• Market Risks:
LST depegs and ETH price drops; managed via diversification across LSTs and auto-exit mechanisms if peg falls below 0.98.
• Operational Risks:
Governance delays or abrupt parameter changes; strategy includes governance alert system and pre-approved exit routes for each platform.
PROTOCOL’ S LIQUIDITY HISTORY:
• Current Liquidity:
Deep liquidity on LSTs: stETH ($20B+), swETH, ezETH, and liquid vaults on Balancer, Curve, and Pendle.
• Historical Performance:
Strong resilience during ETH crashes and LST volatility (e.g., 2022 stETH depeg recovery).
ezETH and swETH showed solid performance during EigenLayer scaling phases.
• Liquidity Disruptions:
Only minor issues during high-volume events; auto-routing through multiple DEXs and reserve liquidity pools to ensure exit efficiency.
REDEMPTION FLOWS:
• DETAILED FLOW:
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User requests withdrawal.
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Vault checks for slippage, peg status, and current exit conditions.
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If safe, vault converts LSTs to ETH via top DEXs or reserve vaults.
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Assets are sent to user wallet or held until conditions normalize.
• POTENTIAL ISSUES:
Temporary LST depeg or DEX slippage >2%; vault delays or exits partially using ETH reserves to protect value.
BEST CASE SCENARIO:
User redeems under normal market conditions with <1% slippage, with ETH delivered in minutes.
WORST CASE SCENARIO:
Market depegs LSTs or gas spikes; smart contract queues exit and notifies user, triggering auto-exit when safety thresholds return.
CONCLUSION
IronClad ETH Vault offers a battle-tested, zero-loss restaking strategy that expands YieldNest’s appeal to institutions, risk-averse users, and long-term ETH holders. It prioritizes principal protection, automated safety nets, and reliable returns, fully aligning with YieldNest’s goal to make DeFi safer, smarter, and more inclusive for all.
Submitted by: @welbina
X- @Saynototrenches
Date: 2025-04-12