afETH Functionality
Last updated
Last updated
afETH is a hybrid LST built of 70% sfrxETH and 30% vlCVX - Visualized below.
Users mint afETH - User deposits are automatically split into 70% sfrxETH and 30% vlCVX. Both assets are held in the afETH contract.
sfrxETH automatically accrues rewards via a price redemption mechanism. CVX is locked in the Convex Vote Locker contract and the voting power is delegated to Votium. On a bi-weekly basis, yield is harvested from Votium, converted into ETH, and entered into The Yield Smoother.
Similar to Yearn's vaults, new ETH rewards are locked up and only gradually accrue to the total value of the vault over time. This is to prevent large discrete jumps in the ETH/afETH price such that a searcher or other MEV extractor could sandwich reward distributions to capture most of their value.
There are no fees. Really.
