Sturdy is a liquidity protocol enabling interest-free borrowing.

Lending

Sturdy

Protocol Code Quality

Protocol Maturity

Protocol Design

Risk Rating

yellow

Average

* [Documentation](https://docs.sturdy.finance/overview/what-is-sturdy) 
 * Auditors 
 	* [Audits](https://www.certik.com/projects/sturdy) 
 	* [CertiK and code4rena](https://docs.sturdy.finance/risk/security-and-audits) 
 * Please see our [FAQ on experienced auditors](https://help.exponential.fi/en/articles/6381015-what-are-experienced-auditors)

Exploit/Hacks

green

None

* [Website](https://sturdy.finance/)  
 * Tags: Lending

Info

* TVL: $22.6M (Rank #107)  
 * TVL Ranking by Lending: #23  
 * Blockchain: Ethereum, Fantom  
 * Chain TVL  
 	* Ethereum: $16.5M  
 	* Fantom: $172.12K

Key Metrics

Information


- Code reviewed by several experienced auditors including [CertiK and code4rena](https://docs.sturdy.finance/risk/security-and-audits)
- Public team promotes accountability
- No documented protocol hacks since launch
- Robust controls to mitigate oracle price manipulation


- Core protocol launched in 2022; maturity less than a year increases technical risk as smart contracts are less battle-tested
- Top 20% by total value locked slightly reduces risk
- Centralized governance increases risk
- At least one critical governance issue documented
- No governance token and/or contracts are fully immutable


- No concerns identified
- Cross-collateral markets are exposed to systemic risks as each asset creates incremental risks for the platform as a whole

Risk Assessment

Sturdy is a new type of lending protocol where yield is generated from the underlying collateral rather than the borrowers themselves.

What we like

Sturdy exposes users to new protocol dependencies as the collateral is redeposited in third-party platforms.

What we like less

Offers you a simple platform to earn high yields as well as the ability to borrow assets completely free (no interest, no deposit/withdrawal fees).

What it means for you

Summary

#### How Sturdy works
Sturdy is a lending protocol that pays lenders through yield earned on third-party platforms (from the borrower's deposited collateral). Generally, the interest earned by lenders is paid by borrowers. For yields to increase, borrowers have to demand leverage and pay more. When a borrower deposits an asset as collateral, Sturdy converts it into an interest-bearing token (ibToken) using protocols like Yearn or Lido. These ibTokens accrue yield over time and are then distributed to lenders in the same token they deposited. Borrowers on Sturdy have no interest payments as they are not paying lenders. Despite this, lenders can still earn high stable yields by deploying the borrower's collateral across third-party DeFi protocols. The yield on ibTokens is collected periodically and distributed to stablecoin lenders. The yield calculation is comparing the value of locked ibTokens to the value of collateral owed to borrowers. The excess ibTokens are unstaked, swapped for stablecoins, and distributed to lenders. Loans are interest-free except for the case where a reserve has utilization greater than 80%. Utilization is the percentage of deposited assets that have been borrowed. The interest rate increases by 3% for every percent that utilization is above 80%.
#### How Sturdy makes money
Sturdy takes a 10% fee on yield generated across its platform.
#### How you make money on Sturdy
You earn lending fees on Sturdy by depositing your idle crypto assets to be used by borrowers looking for leverage.