Yearn — yvUSDT-1

Contract Addresses

Core yvUSDT-1 Contracts

Contract	Address	Type
yvUSDT-1 Vault	0x310B7Ea7475A0B449Cfd73bE81522F1B88eFAFaa	Yearn V3 Vault (v3.0.2), Vyper minimal proxy
Underlying asset (USDT)	0xdAC17F958D2ee523a2206206994597C13D831ec7	Tether USD
Accountant	0x5A74Cb32D36f2f517DB6f7b0A0591e09b22cDE69	Shared Yearn Accountant (0% mgmt, 10% perf)
Fee Recipient (Dumper)	0x590Dd9399bB53f1085097399C3265C7137c1C4Cf	Claims fees and routes to auctions/splitters

Governance Contracts (shared with all Yearn V3 risk-1 vaults)

Contract	Address	Configuration
Yearn V3 Role Manager	0xb3bd6B2E61753C311EFbCF0111f75D29706D9a41	Single instance for all category-1 vaults
Daddy / ySafe (Governance)	0xFEB4acf3df3cDEA7399794D0869ef76A6EfAff52	6-of-9 Gnosis Safe
Brain (Operations)	0x16388463d60FFE0661Cf7F1f31a7D658aC790ff7	3-of-8 Gnosis Safe
Security	0xe5e2Baf96198c56380dDD5E992D7d1ADa0e989c0	4-of-7 Gnosis Safe
Strategy Manager (Timelock)	0x88Ba032be87d5EF1fbE87336b7090767F367BF73	TimelockController — 7-day delay
Keeper	0x604e586F17cE106B64185A7a0d2c1Da5bAce711E	yHaaSRelayer — REPORTING only
Debt Allocator	0x1e9eB053228B1156831759401dE0E115356b8671	Minimal proxy — REPORTING + DEBT_MANAGER

Yearn V3 Infrastructure

Contract	Address
Vault Factory (v3.0.2)	0x444045c5C13C246e117eD36437303cac8E250aB0
Vault Original (v3.0.2)	0x1ab62413e0cf2eBEb73da7D40C70E7202ae14467

Strategies (3 in default queue, 2 with debt)

#	Strategy	Name	Current Debt (USDT)	Allocation
1	0xED48069a2b9982B4eec646CBfA7b81d181f9400B	Spark USDT Lender	3,325,977.14	45.58%
2	0x6D2981FF9b8d7edbb7604de7A65BAC8694ac849F	Morpho Gauntlet USDT Prime Compounder	3,971,032.82	54.42%
3	0x0a4ea2bDe8496a878a7ca2772056a8e6fe3245c5	Morpho Steakhouse USDT Compounder	0	0%

Previously queued, now revoked (activation = 0 at block 25073237):

• USDT Fluid Lender (0x4Bd05E6ff75b633F504F0fC501c1e257578C8A72)
• Aave V3 USDT Lender (0x27998440eC85F0DF11DED26e6aB27c8D2a9d8Cb2)

Sky-governance exposure note: Spark Lend is a Sky sub-DAO. Roughly 45.58% of yvUSDT-1's debt sits in Spark USDT Lender, which is administered through Sky / Spark governance. This is a Sky-governance dependency but not a USDS-peg or USDS-collateral dependency — yvUSDT-1 is materially less Sky-coupled than yvUSDC-1 / yvUSDS-1 / yvDAI-1, but not fully Sky-independent. Captured in the dependency subscore.

Strategy Protocol Dependencies (current allocation)

Protocol	Strategy	Allocation	Notes
Spark	Spark USDT Lender	45.58%	Sky sub-DAO; audited stack (ChainSecurity, Cantina)
Morpho (Gauntlet)	Morpho Gauntlet USDT Prime Compounder	54.42%	Curated by Gauntlet, $6.6B+ Morpho TVL, 25+ audits, Certora formal verification
Morpho (Steakhouse)	Morpho Steakhouse USDT Compounder	0% (queued)	Curated by Steakhouse

The current debt is split ~46/54 across two ecosystems (Spark, Morpho). Both have multi-year USDT track records with no significant principal-loss events. The mix is less diversified than the prior 5-strategy queue but more concentrated than ideal — particularly the ~46% allocation to a single Sky-governed venue. Allocation has drifted slightly toward Morpho between May 5 and May 11 (Spark −$233K, Morpho Gauntlet +$409K).

Audits and Due Diligence Disclosures

Yearn V3 Core Audits

Auditor	Date	Scope	Report
Statemind	May 2, 2024	V3 Vaults (v3.0.0)	PDF
ChainSecurity	May 4, 2024	V3 Vaults + Tokenized Strategy (v3.0.0)	2 PDFs
yAcademy	Jun 2024	V3 Vaults (v3.0.1)	PDF

Underlying Protocol Audits (active and queued strategies)

Underlying	Audits	Notes
Spark (USDT lender)	ChainSecurity, Cantina (Spark Lend / SparkDAO)	Sub-DAO of Sky
Morpho (Gauntlet + Steakhouse USDT)	25+ audits across Trail of Bits, Spearbit, OpenZeppelin, ChainSecurity, Certora; formal verification	Blue-chip, $6.6B+ TVL

Strategy Review Process

All strategies pass through Yearn's 12-metric risk-scoring framework (RISK_FRAMEWORK.md). yvUSDT-1 is registered as Category 1 in the Role Manager (getCategory(vault) == 1), the strictest tier.

Bug Bounty

• Yearn (Immunefi): active, $200,000 max payout (Critical). https://immunefi.com/bounty/yearnfinance/
• Yearn (Sherlock): also listed at https://audits.sherlock.xyz/bug-bounties/30
• Underlying protocols (Spark, Morpho) both have active bug bounty programs
• Safe Harbor (SEAL): Yearn is not listed on the SEAL Safe Harbor registry

On-Chain Complexity

Low. All funded strategies are direct USDT lend / compound with no conversion hops:

• Spark USDT Lender → direct supply to Spark Lend USDT market
• Morpho Gauntlet USDT Prime Compounder → direct USDT deposit to a Morpho Gauntlet vault
• No leverage, no looping, no cross-chain
• Standard ERC-4626 throughout
• Vault is immutable

Historical Track Record

• Vault deployed: July 23, 2024 (deployment tx) — ~21.6 months in production
• TVL: 7,297,009.96 USDT (~$7.30M) — well within the $50M deposit limit
• PPS trend: 1.000000 → 1.080708 (~8.07% cumulative return, ~4.5% annualized)
• Security incidents: None known for this vault or for the Yearn V3 framework
• Strategy changes: active management — five strategies have been queued historically. Between April 27 and May 5, Fluid USDT and Aave V3 USDT were revoked (activation = 0); funds were also re-deployed from the brief 100%-idle state into the remaining Spark + Morpho Gauntlet venues
• Yearn V3 track record: V3 framework live since May 2024 (~24 months). No V3 vault exploits

Yearn protocol TVL: ~$197.5M total across all chains (DeFiLlama, April 2026).

Underlying USDT lending market track records: Spark Lend and Morpho both have multi-year track records on USDT markets with no significant principal-loss events.

Funds Management

yvUSDT-1 is 100% deployed at the snapshot, split ~46/54 between Spark USDT Lender and Morpho Gauntlet USDT Prime Compounder. Morpho Steakhouse USDT remains queued but unfunded.

Current State (snapshot)

• Total Assets: 7,297,009.96 USDT
• Total Debt: 7,297,009.96 USDT (100% deployed)
• Total Idle: 0
• Capital utilization: 100%

ERC-4626 redemptions now settle by unwinding strategy positions in queue order — atomic from the user's perspective as long as the underlying lending markets have available liquidity (Spark Lend and Morpho USDT markets are both deep multi-million-USDT venues).

Active Strategies

Strategy	Allocation	Mechanic	Risk profile
Spark USDT Lender	45.58%	Direct supply to Spark Lend USDT market	Sky sub-DAO, ChainSecurity / Cantina audits
Morpho Gauntlet USDT Prime Compounder	54.42%	Direct USDT deposit to Morpho Gauntlet vault	Curated by Gauntlet, blue-chip lending markets
Morpho Steakhouse USDT Compounder	0% (queued)	Direct USDT deposit to Morpho Steakhouse vault	Curated by Steakhouse, blue-chip lending markets

All are simple lend / compound patterns with no leverage, no conversion hops, and no cross-chain.

Accessibility

• Deposits: Permissionless ERC-4626. Subject to 50M USDT deposit limit
• Withdrawals: ERC-4626. Strategy unwind through Spark + Morpho USDT markets (both deep)
• No cooldown or lock period
• Fees: 0% management, 10% performance
• Profit unlock: 10 days

Collateralization

• 100% USDT backing — held in Spark and Morpho USDT lending positions
• Collateral quality: USDT is the largest stablecoin by market cap. Centrally-issued by Tether
• No leverage
• Redemption: atomic for normal sizes; very large redemptions depend on Spark / Morpho market utilization at the moment of withdrawal

The collateral quality is the union of Spark Lend USDT and Morpho USDT market quality — both are blue-chip USDT venues with multi-year clean track records.

Provability

• PPS: ERC-4626, fully algorithmic
• Strategy totalAssets(): reads the underlying lending position balance on-chain in both Spark and Morpho
• Profit / loss reporting: keepers via process_report(), profits unlock over 10 days

Liquidity Risk

Exit pipeline: ERC-4626 withdraw → strategy withdraw → underlying lending market withdrawal (Spark Lend USDT or Morpho Gauntlet USDT vault).

• Underlying liquidity: Spark Lend USDT and Morpho Gauntlet USDT are both multi-million-dollar venues with healthy utilization headroom; ~$3.3M (Spark) and ~$4.0M (Morpho) here are small fractions of either market's free liquidity
• Same-asset: USDT-denominated share token — no price-divergence risk
• No DEX liquidity needed — exits via the lending protocol's own redemption mechanics
• No withdrawal queue or cooldown — atomic redemption for normal sizes
• Deposit limit: 50M USDT cap vs $7.30M TVL (room for +585%)

The two-ecosystem split (~46% Spark / ~54% Morpho) means a liquidity squeeze in one venue can be partially absorbed by the other (subject to queue order and the user's withdraw size).

Centralization & Control Risks

Governance

Position	Address	Threshold	Roles on Vault
Daddy (ySafe)	0xFEB4acf3df3cDEA7399794D0869ef76A6EfAff52	6-of-9	12 of 14 vault roles
Brain	0x16388463d60FFE0661Cf7F1f31a7D658aC790ff7	3-of-8	QUEUE, REPORTING, DEBT, MAX_DEBT, DEPOSIT_LIMIT, WITHDRAW_LIMIT, PROFIT_UNLOCK, DEBT_PURCHASER, EMERGENCY
Security	0xe5e2Baf96198c56380dDD5E992D7d1ADa0e989c0	4-of-7	DEBT, MAX_DEBT, EMERGENCY
Strategy Manager (Timelock)	0x88Ba032be87d5EF1fbE87336b7090767F367BF73	7-day delay	ADD_STRATEGY, REVOKE_STRATEGY, FORCE_REVOKE, ACCOUNTANT, MAX_DEBT
Keeper	0x604e586F17cE106B64185A7a0d2c1Da5bAce711E	Bot	REPORTING only
Debt Allocator	0x1e9eB053228B1156831759401dE0E115356b8671	Bot	REPORTING + DEBT_MANAGER

ySafe 6-of-9 signers include publicly known DeFi contributors — see Yearn Multisig Info.

Properties:

1. No EOA holds vault roles directly
2. Strategy additions and accountant changes pass through 7-day timelock
3. Self-governed timelock — TIMELOCK_ADMIN belongs to the timelock itself
4. Vault contract is immutable — Vyper minimal proxy
5. Same governance pattern across 37+ vaults

Programmability

• PPS: ERC-4626, fully algorithmic
• Vault operations: permissionless deposit / withdraw on-chain
• Strategy reporting: automated via keeper (when strategies are funded)
• Debt allocation: Debt Allocator (automated) + Brain (manual) — currently 0 deployed
• Off-chain inputs: none

External Dependencies

Dependency	Criticality	Notes
USDT (Tether)	Critical (underlying asset)	Centrally issued; relies on Tether's operational and reserve integrity
Spark Lend	High (~46% of debt)	Sky sub-DAO; Spark admin keys live under Sky governance
Morpho (Gauntlet curator)	High (~54% of debt)	Morpho protocol $6.6B+ TVL; Gauntlet curator selects underlying markets
Sky governance	Indirect via Spark	Spark Lend admin sits under Sky; not an independent venue

Dependency quality: the deployed mix is two blue-chip ecosystems split ~46/54 (Spark + Morpho/Gauntlet). Less diversified than the prior 5-strategy queue, and ~46% of debt sits behind Sky-governed infrastructure. Materially less Sky-coupled than yvUSDC-1 / yvUSDS-1 / yvDAI-1 (which carry direct USDS exposure) but not fully Sky-independent as the original report claimed.

Operational Risk

• Team: Yearn Finance — established 2020, public contributors, named multisig signers
• Vault management: Standard Yearn V3 Role Manager pattern shared across 37+ vaults
• Documentation: Comprehensive Yearn V3 documentation. Strategy code verified on Etherscan
• Legal: Yearn BORG via YIP-87
• Incident response: 4 historical V1 events handled. V3 framework not yet stress-tested by an exploit
• V3 immutability: vault cannot be upgraded
• Operational anomalies:
  • The brief late-April 100%-idle posture (followed by full redeployment by May 5) showed Brain / Debt Allocator can rapidly pull and re-route debt. Per the Yearn team the deallocation was precautionary following the rsETH bridge exploit (unverified attribution)
  • Two strategies revoked between April 27 and May 5 — USDT Fluid Lender and Aave V3 USDT Lender now have activation = 0. The redeployment landed in a narrower set of venues (Spark + Morpho only). The rationale for revoking those two specifically has not been independently verified

Monitoring

Existing Monitoring Infrastructure

Yearn maintains the monitoring repository with active alerting. yvUSDT-1 is in the monitored vault list:

• Large flow alerts (yearn/alert_large_flows.py) — runs hourly via GitHub Actions
• Endorsed vault check (yearn/check_endorsed.py) — weekly
• Timelock monitoring (timelock/timelock_alerts.py)

Key Contracts

Contract	Address	Monitor
yvUSDT-1 Vault	0x310B7Ea7475A0B449Cfd73bE81522F1B88eFAFaa	PPS (convertToAssets(1e6)), totalAssets(), totalDebt(), totalIdle(), Deposit / Withdraw events
Each active USDT strategy	(3 queued addresses above)	totalAssets(), current_debt, isShutdown(), keeper report frequency
ySafe (Daddy)	0xFEB4acf3df3cDEA7399794D0869ef76A6EfAff52	Signer / threshold changes
Accountant	0x5A74Cb32D36f2f517DB6f7b0A0591e09b22cDE69	Fee changes

Critical Events to Monitor

• Allocation drift — currently ~50/50 Spark/Morpho; a drift toward >75% in one venue should trigger reassessment of the dependency subscore
• Strategy current_debt changes — DebtUpdated events on the vault
• Strategy additions / removals — StrategyChanged events (new strategies pass through 7-day timelock; further revocations are operational signals)
• Emergency actions (Shutdown)
• ySafe / Brain / Security signer or threshold changes
• PPS decrease — should only increase outside of explicit loss events
• Sky / Spark governance events — Spark Lend admin actions can affect ~50% of yvUSDT-1's debt
• USDT-specific: Tether-side issues (peg deviation, attestation reports, blacklisting events)

Monitoring Functions

Function	Contract	Purpose	Frequency
convertToAssets(1e6)	Vault	PPS tracking	Every 6 hours
totalAssets()	Vault	Total TVL	Daily
totalDebt() / totalIdle()	Vault	Capital deployment ratio — currently 100% deployed	Daily
strategies(address)	Vault	Per-strategy debt, last report time, activation (revocations show activation = 0)	Daily
get_default_queue()	Vault	Withdrawal queue composition (currently 3 strategies)	Weekly
getThreshold() / getOwners()	ySafe	Governance integrity	Weekly
getMinDelay()	ySafe	Delay change detection	Weekly

Reassessment Triggers

• Time-based: Reassess in 6 months (November 2026) or annually
• TVL-based: Reassess if TVL exceeds $25M or changes by ±50%
• rsETH-related context: if any new strategy is added that takes direct or indirect rsETH exposure, full re-review of the dependency subscore
• Strategy posture:
  • if a USDS-denominated strategy is later added to yvUSDT-1, the partial Sky-coupling becomes a peg dependency — re-evaluate dependency and concentration scores against the broader risk-1 stable stack
  • if either venue's allocation drifts above ~75% of deployed funds, re-evaluate the dependency / liquidity scores
  • if Morpho Steakhouse USDT is funded (currently queued at 0), re-check the per-venue concentration
  • if any further strategy revocations occur, investigate the rationale
• Underlying-protocol incidents: any major incident at Spark Lend or Morpho USDT markets — full re-review
• USDT-specific:
  • sustained Tether peg deviation
  • Tether reserve attestation issues
  • significant blacklisting / freezing events
• Governance-based: ySafe / Brain / Security signer or threshold changes; any change to the timelock delay (would itself require 7 days)

---

Appendix: Contract Architecture

┌─────────────────────────────────────────────────────────────────────┐
│                         VAULT LAYER                                  │
│                                                                      │
│  ┌───────────────────────┐                                          │
│  │  yvUSDT-1 (v3.0.2)   │                                          │
│  │  ERC-4626, immutable  │                                          │
│  │  0x310B…FAaa          │                                          │
│  │                       │                                          │
│  │  $7.30M USDT TVL      │                                          │
│  │  100% deployed        │                                          │
│  │  totalDebt = $7.30M   │                                          │
│  │  totalIdle = 0        │                                          │
│  └───────────┬───────────┘                                          │
│              │                                                       │
│      ┌───────┴────────┐                                             │
│      ▼                ▼                                             │
│  Spark USDT       Morpho Gauntlet                                   │
│  3.33M (45.58%)   3.97M (54.42%)                                    │
│  Sky sub-DAO      Morpho protocol                                   │
│                                                                      │
│  Also queued (unfunded): Morpho Steakhouse USDT (0 debt)            │
│                                                                      │
│  Revoked between Apr 27 and May 5 (`activation = 0`):               │
│   - USDT Fluid Lender (0x4Bd0…8A72)                                 │
│   - Aave V3 USDT Lender (0x2799…8Cb2)                               │
└──────────────────────────────────────────────────────────────────────┘

The vault is now ~46/54 across two ecosystems. ~46% sits behind Sky-governed
infrastructure (Spark Lend), so yvUSDT-1 is materially less Sky-coupled
than the USDS-denominated risk-1 vaults but **not Sky-independent**. The
prior 5-strategy queue offered better venue diversification. Allocation
has drifted slightly toward Morpho between May 5 and May 11.

Appendix: TimelockController Role Structure

TimelockController 0x88Ba032be87d5EF1fbE87336b7090767F367BF73 — same timelock used by 37+ Yearn V3 vaults including all six mainnet risk-1 vaults. getMinDelay() = 604800 (7 days).

Role	Holder	Type	Notes
DEFAULT_ADMIN	No holder	—	Never granted (admin = address(0))
TIMELOCK_ADMIN	Timelock itself	Contract	Self-governed
PROPOSER	Daddy/ySafe	6-of-9 Safe	Sole proposer
EXECUTOR	Daddy/ySafe	6-of-9 Safe	Direct execution
EXECUTOR	TimelockExecutor 0xf8f60bf9456a6e0141149db2dd6f02c60da5779b	Contract	Wrapper: Brain (3/8) + deployer EOA can call execute() through it
CANCELLER	Daddy/ySafe	6-of-9 Safe	Cancel pending proposals
CANCELLER	Brain	3-of-8 Safe	Cancel pending proposals

To shorten the delay, Daddy 6/9 must propose updateDelay(), wait 7 days during which Brain or Daddy can cancel, then execute. DEFAULT_ADMIN was never granted, so no party can self-grant PROPOSER or TIMELOCK_ADMIN to skip the flow.