💹JPYC Lending Strategy

Automated, rule-based JPYC lending into Fixed-Rate Lending markets

Overview

The JPYC Lending Strategy is the first strategy deployed within the JPYC Vault under the Secured Finance framework.

This strategy is designed to generate yield by deploying JPYC into the Secured Finance fixed-rate lending markets, allowing Vault participants to earn variable returns without actively managing positions.

The strategy is fully rule-based: every rule described on this page is encoded in the deployed strategy contract, which can be inspected on-chain directly from the Vault page.

Base asset	JPYC
Network	Ethereum
Strategy contract	Secured Finance JPYC Lender — see Contracts and Security
Vault share token	yvJPYC
Yield type	Variable

Purpose of the strategy

The primary objectives of the JPYC Lending Strategy are:

• To provide a simple, automated way to earn yield on JPYC

• To abstract away lending market operations from users

• To integrate JPYC into the broader Secured Finance fixed-income ecosystem

Users interact with the Vault, not the strategy directly.

How yield is generated

The strategy places limit lend orders in the JPYC fixed-rate markets according to fixed rules:

• Allocation: deposits are split across the two nearest eligible maturities at a fixed 40% / 60% ratio (nearest / next), set immutably at deployment.

• Eligibility: a maturity is excluded automatically when it is within the maturity exclusion period (default: 7 days) of expiry, or its order book is in Itayose / pre-order state, or the market is closed. When the nearest maturity enters the exclusion window, allocation shifts to the next eligible pair automatically.

• Order placement: one limit lend order per eligible maturity, priced just below the current best lend price (or at the market mid where more favorable), subject to a minimum APR floor of 1%.

• Rebalancing: orders are re-placed only when recalculated target rates deviate from resting orders by more than 25 bps, or when idle funds are at least 100 JPYC. These conditions are publicly computable on-chain.

• Capacity: total deposits into this vault are capped at 5,000,000 JPYC.

Interest earned on filled positions increases the Vault's total assets, which increases the value of Vault shares. Returns are variable and depend on market conditions.

User experience

From the user's perspective:

• JPYC is deposited into the Vault

• Vault shares are received

• Yield accrues automatically over time

• Withdrawals are performed by redeeming shares

Users do not need to select lending terms, manage maturities, or rebalance positions.

Relationship to Fixed-Rate Lending

The JPYC Lending Strategy differs from Secured Finance's Fixed-Rate Lending product in several key ways:

• JPYC Lending Strategy

  • Variable yield

  • No fixed maturity

  • Fully automated allocation

• Fixed-Rate Lending

  • Fixed interest rate

  • Defined maturity

  • Direct position management

Both products coexist within the ecosystem and serve different user preferences.

Liquidity and withdrawals — please read

Withdrawals are served in a fixed order:

1. Idle funds held by the vault and strategy;

2. Cancellation of the strategy's own resting orders, starting from the farthest maturity (preserving near-term positions);

3. Unwinding of positions, starting from the nearest maturity, executed against the live order book.

Material limitation: step 3 depends on order-book liquidity. If the book cannot absorb the unwind, the withdrawal transaction reverts ("Not enough funds freed") rather than executing at a distorted price or realizing an artificial loss. Funds remain in the vault; you can try a smaller amount, or try again once liquidity recovers. Withdrawal availability is therefore not guaranteed at all times and depends on market liquidity at the moment of withdrawal.

Positions held to maturity are auto-rolled into the next maturity by the protocol's rotation mechanism; roll pricing is determined by the next maturity's order book at rotation time, with no strategy discretion.

Fees

• Performance fee: 5% (500 bps) of realized profits, accrued at report time to the on-chain designated fee recipient.

• The strategy charges no fees on deposits or withdrawals.

• Order execution in the underlying fixed-rate market incurs the protocol's standard order fee, as for any market participant; this cost is reflected in strategy returns.

Current fee parameters are readable directly from the strategy contract.

Automated execution and governance

• Execution involves no per-trade discretionary decisions: no person selects individual trades, counterparties, timing, or prices.

• Strategy parameters are either fixed at deployment (maturity split, order count, minimum APR, maintenance threshold) or adjustable only through disclosed governance functions restricted to the management role (deposit limit; maturity exclusion period). Every parameter change is an on-chain transaction, publicly visible and permanently auditable.

• The management role governs the adjustable parameters above; a separate keeper role may call the maintenance functions (tend / report) only. The current management, keeper, and fee-recipient addresses are readable directly from the strategy contract, which is the authoritative source.

• The strategy contract's logic is not upgradeable. Share accounting is delegated to Yearn v3's audited TokenizedStrategy implementation.

The strategy cannot lend outside the Secured Finance JPYC markets defined above, and cannot access depositor funds for any purpose other than the lending flows described here.

Risk considerations

The JPYC Lending Strategy involves several types of risk, including but not limited to:

• Liquidity / withdrawal risk — withdrawals may fail temporarily when order-book liquidity is insufficient (see above)

• Rate risk — fixed-rate position values fluctuate with market rates until maturity; early unwinds execute at prevailing market prices

• Roll risk — auto-roll pricing depends on next-maturity order-book conditions at rotation

• Smart contract risk — vault, strategy, and protocol contracts may contain defects notwithstanding audits

• Stablecoin risk — JPYC issuer and peg risk

Users should understand that principal is not guaranteed, returns may fluctuate, and losses are possible under adverse conditions.

See also the protocol-wide Risk Disclaimer.

Future evolution

The strategy may be complemented or replaced by additional strategies over time. Any strategy deployment or parameter change is an on-chain transaction and will be reflected in updated documentation.

Related

• USDFC Lending Strategy — the same framework on Filecoin

• Strategy Framework and Allocation Model — how strategies plug into vaults

• Fixed-Rate Lending — the markets this strategy lends into