Overnight

Yield

Overnight is a DeFi protocol behind USD+, a yield generating stablecoin with a daily profit payout

Risk Rating

Average

Protocol Code Quality

Protocol Maturity

Protocol Design

Summary

What we like

Overnight offers a fully collateralized, yield-generating stablecoin that acts as a DeFi equivalent of a money market fund with a daily profit distribution.

What we like less

The underlying collateral is exposed to third-party technical risks as it is deposited into third-party DeFi platforms.

What it means for you

Offers you a simple way to passively earn yield on your USD, while maintaining exposure to a non-volatile instrument to hedge your portfolio against market conditions.

Information

Exploit/Hacks

None

Documentation
Auditors
- Hacken
- Audits
- Audits
- Audits
Please see our FAQ on experienced auditors

Info

Website
Token: OVN
Tags: Yield

Key Metrics

TVL: $38M (Rank #74)
TVL Ranking by Yield: #0
Blockchain: Arbitrum, Optimism, Binance, zkSync Era, Polygon
Chain TVL
- Arbitrum: $21.26M
- Optimism: $10.59M
- Binance: $4.1M
- zkSync Era: $1.7M
- Polygon: $386.79K

Risk Assessment

Average

Protocol Code Quality

Code reviewed by at least one experienced auditor; Hacken audited in February 2022
Public team promotes accountability
No documented protocol hacks since launch

Protocol Maturity

Core protocol launched in 2021; maturity over a year reduces technical risk as smart contracts are moderately battle-tested
Bottom 80% by total value locked increases risk
Centralized governance increases risk
At least one critical governance issue documented
No governance token and/or contracts are fully immutable

Protocol Design

No concerns identified

Things to know about Overnight

How Overnight works

Overnight is a DeFi protocol that issues USD+, a yield generating stablecoin with a daily profit payout. USD+ is a fully collateralized stablecoin that is backed by yield-generating assets and pegged 1:1 to USDC. Users can mint USD+ from the official Overnight front-end app by converting USDC. Once minted, the USD+ begins to immediately accrue compounded yield. Overnight uses a liquidity index reflecting the current ratio of the number of issued USD+ tokens to the volume of assets on strategies, expressed in USDC. USD+ is able to generate yield as the protocol deploys the underlying stablecoins to third-party DeFi platforms. The yield generated from interest, trading fees, and protocol rewards is pooled and converted to stablecoins to produce USD+-denominated yield. This yield is passed on to USD+ holders through a constant rebasing of the token supply. This allows the USD+ price to stay pegged at 1 USD while the user's token balance adjusts in real-time to reflect the accrued yield.

How Overnight makes money

The protocol applies a 0.04% fee on all minting and redeeming of USD+. The fee goes to the Overnight collateral pool and is used to compensate existing USD+ holders for the accumulated but not yet paid out daily profit. There is currently no revenue accrual mechanism for Overnight itself.