Grayscale Research believes onchain vaults may break into traditional finance. Similar to collateralized loan obligations (CLOs), vaults pool capital into managed portfolios, but are fully onchain. Today, onchain vaults hold ~$7B in total value locked (TVL), a fraction of the ~$1.5 trillion CLO market. Read more on The Stack:

Double-digit access to @ethena's yield. No loop to unwind. jrUSDe pays 10.92% today. sUSDe pays 3.9%. Same underlying, same strategy, zero borrowing. srUSDe holders give up part of their yield for a floored return and first-loss protection. That premium flows to jrUSDe. Today, with $60M of senior above $6.5M of junior, every basis point the senior gives up reaches the junior multiplied by nine. 3.9% underlying plus the premium at 9.2x is 10.9%. That ratio is leverage, roughly 10x. About the same as a max PT loop on Aave. What differs is what kills the position. A loop at 11.3x runs a 2% buffer to liquidation. A temporary depeg, a borrow spike, an oracle mark: any of these can force the unwind, at the worst moment, with no loss ever realized. Path risk, priced in basis points. jrUSDe has no LTV, no health factor, no borrow rate, no maturity, no liquidator. Impairment requires a realized loss in the underlying of roughly 10% of the pool before junior capital is exhausted. Nothing in sUSDe's history has come close to that in a single episode. Not October 10. Not the November stress. To be precise about the trade: this is first-loss capital. If sUSDe realizes a loss, junior absorbs it before senior loses a cent. That seat is exactly what earns the 10.9%. But the risk you are not taking is the one that actually ends most levered positions: being right about the asset and forced out anyway. The loop pays you to survive the path. The junior pays you to be right about the destination. Same leverage. Better failure mode. Double digits, no unwind.