Spool Automated yield platform launching soon..

Technically, today makes it the 89th day since BTC was $50,000 and ETH was $4,000. I can very well remember the sentiments that were flying around at that time. A whole lot of speculation about BTC and ETH hitting $100,000 and $10,000 respectively was made. 90 days later, the two top coins have danced below expectations. Not only that, every other alts followed the dip trend. It almost became a normal thing. An average crypto trader at some point was beginning to make net losses. It was even worse for folks that bought the top. Now, a lot of people are pissed off but they can’t complain.

On the other side were the minority, those who were lucky enough to learn early that investing in cryptocurrency is not just about chasing dumps and pumps. These are the guys that have maximized the incredible opportunities that come with DeFi. Yield farming, providing liquidity and lending may be strange words to a DeFi noob. However, they are currently the most logical way to earn steady passive income in the crypto space.

A lot of people are already familiar with yield generators like Aave, Compound, Curve etc. Anchor protocol is the recently popular one with 19% APY on stables. What a lot of people are yet to be familiar with is Spool, which basically acts as infrastructure middleware that offers users a way to participate in a combination of other yield aggregators while limiting risk. How cool is the sound of getting the average of the yield generating power of different yield protocols all at the same time? You are about to see that in full action as the DAO-ran project is wrapping up its Alpha release for the quarter.

For the sake of uninformed gents, Spool is simply a new form of auto-compounder. By definition, it is a kind of vault with a smart contract that automatically routes users' deposits into an array of different Yield generators in a risk-managed and yield-optimized manner.

Basically, a spool is made up of a risk model, risk tolerance and subset of yield generators. In whole, this represents a yield strategy. According to the design, there will be a lot of spools inside the protocol giving users enough flexibility to decide on the yield strategy that they are most comfortable with. Another big deal about it is that users have the option to adjust their risk tolerance and yield strategy in general before their deposits to meet a target APY. No matter how wide your appetite is, you can combine the right set of parameters to get you the yield you desire from your assets over a period of time.

It’s a very interesting thing to look forward to. The best part of it is that it’s entirely automatic. No need for constant rebalancing and protocols associated with general DeFi platforms. In addition, SPOOL token is regularly emitted to boost the yield of individual spools. This simply means that besides the APY rewards you get from getting your deposits through the yield generators, you will get additional SPOOL tokens which will be released to individual Spools based on the directives of the SPOOL DAO. This puts the DAO in a very commanding position to decide who gets the biggest rewards in SPOOL.

SPOOL, being a governance token is not required to participate and earn from the ecosystem. However, staking SPOOL secures a person’s access into the Spool DAO. Interestingly, staking SPOOL has no APY benefits but the reward is far more lucrative.

Besides the substantial performance fees that they will receive, the token stakers get voSPOOL which is accrued based on the SPOOL staked by a user. Holders of voSPOOL have the governance with a voting power that can be applied in several ways including deciding fees structure, managing treasury emission to different spools, determining risk models and strategies proposals etc.

It’s a fantastic design and there is something particular I noticed from Spool protocol’s structure. It’s quite obvious that the team assessed a lot of DeFi yield protocols and identified the gaps therein. To a major extent, what their product is offering to deliver solves a lot of the problem that we have seen with DeFi yield tools; especially with the case of poor risk models, poor UI/UX design and lack of automated solution for noobs and people with low knowledge and skill in the DeFi space.

The official development of the remarkable project started in August 2020. Now the Alpha product which is its first official release should be out soon. If there is anything to be bullish on right now, it is SPOOL.