[Proposal] Yield Bearing Index using xToken (YBI)


Create an index of xTokens which passively accumulates yield for popular assets like SNX (xSNX), AAVE (xAAVE), and 1INCH (x1INCH).


Be the first indexing project to create a yield bearing index for top DeFi projects. xTokens automatically accrue value as “set-and-forget” tokens where the staking component is automatically managed for users; by combining the most popular xTokens in to a single index, Indexed would offer a very valuable token that would save holders a substantial amount of gas, time, and energy.


The weighting of the tokens would be roughly based on the underlying assets market cap. xTokens’ prices reflect the yield they earn so little would be required from the Indexed team aside from setting up the index and occasionally rebalancing as the Indexed DAO demanded.





Liquidity Mining

Both projects could offer their native token as incentive for an ETH/YBI pool which would likely attract significant attention.

Do these tokens have liquidity on Uniswap V2 pairs with ETH?
Our current index controllers both require that they do, otherwise it won’t be able to figure out accurate prices for re-indexing.

Would Balancer work?

Unfortunately no. I am working on Indexed V2 which could support this, and the Sigma committee’s been discussing a third controller prior to v2 to support other oracles, but at the moment we require liquidity on the UNIV2 eth pair.

Okay, good to know. I’ll look into whether Uniswap liquidity is a near term goal for xToken. If using Balancer or another alternative becomes available let me know too. Happy to connect the two teams if there’s workarounds.


Great idea…love it… the xToken paradigm is becoming a thing… most protocols will start having X version of their tokens which will capture value in certain ways…

Naturally, if there’s index for selected protocols token.

Why not just thrown in the xToken versions index too… :nerd_face::nerd_face:


I had been thinking about something like this too! I think this concept is great because it is pretty straightforward to understand. Why have just an index of 1INCH when you can have an index of x1INCH? I’d add xSushi to the mix too. The Uniswap liquidity seems like a roadblock for now at least though.

Adding another level, I think these x-tokens will be widely acceptable as collateral soon. For example, xShushi is available to put up on AAVE and Ruler. If we could have a strategy/vault that leveraged these xTokens to earn more yield on curve or yearn or something that would be pretty slick.

I think that’s space we should try and get into, here’s your basket of goods and here’s how we are using that basket to earn you more yield. And we could attack that from 2 fronts. First, continue efforts to make our assets like DEFI5 available to use as collateral and thus allowing users to create their own additional yields/strategies. And second, create new tokens that did it all for you. Take the xTokens in the " XETF" and leverage stable coin yields. This would add some extra sets of risks, but could be appealing.

As I’m writing I guess another strategy could be to keep the indexes themselves a bit simpler (and not leveraging them) but then to offer different vaults in house where users could stake DEFI5 into a yearn strategy for example. Users could pick and choose their strategies. I guess that would require Indexed using a compound/Aave fork or something to create the lending markets? I’m not sure if this is a bit what Vesper and others are doing? It’s not indexes but they are allowing users to deposit assets into a variety of interconnected vault strategies.