Future Development

Leveraged Liquidity Providing

Yei's leveraged yield farming enables users to enhance returns by using borrowed funds to significantly increase their LP positions. This approach is highly capital-efficient, allowing undercollateralized loans so that farmers can borrow amounts exceeding their deposits. The resultant leveraged liquidity boosts DEXs, elevating SPOT and PERP trading experiences on Sei. Furthermore, this borrowing demand generates organic interest, which in turn yields higher returns for lenders.

Cross-Chain Lending

Yei V2 introduces cross-chain lending, enabling users to borrow and lend assets across multiple ecosystems without bridging. This universal liquidity layer improves capital efficiency and expands DeFi lending opportunities. Assets like USDC and USDT will have universal interest rates across all supported chains, reducing arbitrage inefficiencies and improving the lending market’s accessibility. The Sei-based "hub" architecture will coordinate transactions across all "spoke" deployments on different chains, ensuring seamless interoperability.

YeiSwap

YeiSwap is an integrated decentralized exchange (DEX) built on top of Yei Finance, utilizing deposited lending market assets as liquidity. Instead of conventional liquidity pools, YeiSwap pairs wrapped yTokens against each other, enhancing capital efficiency by allowing liquidity to generate yield from both lending interest and trading fees.

For example, instead of a traditional SEI/USDC LP, YeiSwap will use wySEI and wyUSDC, which are wrapped versions of yTokens. When users swap SEI for USDC, the backend process involves depositing SEI into Yei’s lending market, wrapping the received ySEI into wySEI, and swapping it for wyUSDC, which is then unwrapped and redeemed as USDC.

Yei Ecosystem Roadmap

• February 2025: Yei V2 live on Testnet

• March 2025: YeiSwap live on Testnet

• April 2025: YeiSwap goes live on Mainnet

• May 2025: Yei V2 goes live on Mainnet

These developments mark significant upgrades to the Yei ecosystem, reinforcing its vision of creating a seamless, capital-efficient DeFi experience.