Yield Engine

Discovery & Verification

The yield engine is AlphaYields' core methodology. Rather than allocating to a fixed strategy or routing to the highest available APY, it continuously discovers, evaluates, and verifies yield opportunities — allocating only to those that meet a defined standard of verifiability, sustainability, and risk adjustment.

The problem with aggregator data

Third-party yield aggregators frequently report materially incorrect figures. The sources of error include:

▪Incentive inflation. Emissions and points rewards folded into headline APY — temporary subsidies that vanish when the programme ends.
▪Stale data. Aggregator APIs update infrequently and lag protocol-level changes by hours or days.
▪Incorrect methodology. Short-term snapshots annualised in ways that dramatically overstate sustainable yield.
▪No risk adjustment. A 40% APY from an unaudited protocol and a 40% APY from Aave are displayed identically.

AlphaYields discards aggregator data entirely for allocation decisions. Every yield figure used internally is computed directly from onchain share price across a defined rolling window.

Onchain APY methodology

7-day

Short-term yield tracking; useful for detecting recent changes.

30-day

The primary operational metric for allocation decisions.

90-day

Medium-term verification, used for strategy-level reporting.

For each vault, the engine fetches the ERC-4626 share price at the start and end of the window directly from chain data, then annualises the change — real yield, net of all fees, slippage, and compounding. Vaults that do not implement a computable ERC-4626 share price are excluded.

Verification checklist

Every candidate vault must satisfy all of the following before capital is allocated.

Audit coverage — recognised security firm with a public report. No exception.

Yield verifiability — APY must be independently computable from onchain share price.

Incentive independence — yield modelled with emissions removed; the conservative figure is used, not the headline.

Withdrawal mechanics — timelocks, redemption queues, and admin controls reviewed. No privileged lock-up.

Platform trust review — multisig structure, upgrade policies, timelock settings. Single-key control is excluded.

Drawdown history — unexplained drawdowns or undocumented incidents are excluded.

Social monitoring — AI-assisted scanning of public channels for emerging risk signals, ongoing.

Exclusion criteria

The following disqualify a vault regardless of yield:

✕No completed public audit

✕Yield not computable from onchain data

✕Single admin key with no timelock

✕Emission-dependent yield below 5% underlying

✕Open unresolved security incidents

✕Under 30 days of onchain share price history

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