TREE Series (8): tAssets On-Chain Interest Arbitrage
tAssets is one of the core innovations of the Treehouse protocol, representing the next generation of liquid staking tokens (LST 2.0). Through tAssets, users can easily participate in on-chain interest arbitrage, obtaining returns that surpass traditional PoS staking. Taking tETH as an example, it dynamically adjusts capital allocation within lending protocols (such as Aave and Spark) to capture interest rate spreads in the market, providing users with Market Efficiency Yield (MEY).
tAssets' arbitrage mechanism is not complicated: when a user deposits ETH or LST, the protocol uses the assets as collateral to borrow more ETH, then converts the borrowed ETH into LST, amplifying staking returns. This strategy significantly enhances yield while ensuring the safety of funds. The daily yield distribution of tAssets is reflected in the exchange rate between tETH and wstETH, which is transparent and efficient.
More importantly, tAssets are not just yield tools. They play a crucial role in the DOR ecosystem, allowing users who stake tAssets to support a decentralized interest rate system in exchange for a share of query fees. This design makes tAssets a bridge connecting yield and governance. Whether you are a DeFi novice or an experienced player, tAssets open a door to on-chain fixed income that balances flexibility and high returns. $TREE
