DeFi lender Spark deploys $100 million into Superstate fund to diversify revenue as US Treasury yields dip
DeFi lending protocol Spark, a key component of the Sky ecosystem, is allocating a not insignificant portion of its stablecoin reserves into Superstate's USCC fund in what the projects are calling "the first large-scale" attempt from an onchain protocol to "diversify away from government securities."
Spark has allocated $100 million of its stablecoin reserves to the Superstate Crypto Carry Fund, designed to generate yield from a spot and futures crypto basis trade, according to an announcement on Thursday. USCC has over $411 million in total value locked (TVL), according to DeFiLlama data.
"Superstate's USCC fund allows Spark to diversify its reserves while maintaining the same level of safety and compliance Spark always prioritizes," said Sam MacPherson, CEO of Phoenix Labs, the dev group behind Spark. "As onchain ecosystems evolve, combining regulated yield with transparent, verifiable infrastructure is essential to delivering stability and long-term value for Spark’s users."
The move comes as Treasury yields hit six-month lows. Historically, Spark has generated a substantial portion of its yield, passed on to lenders, via tokenized treasury products like BlackRock's BUIDL and Franklin Templeton’s FOBXX funds, which in turn invest in U.S. government debt.
"Access to stable, diversified yield is increasingly critical as Treasury returns compress," Superstate CEO Robert Leshner said. "The investment allows Spark to maintain exposure to yield opportunities uncorrelated with Federal Reserve rate policy while operating within a compliant institutional framework."
Indeed, much of the crypto yield economy is supported by Treasurys. The two largest stablecoin issuers, Tether and Circle, safeguard a majority of their reserves in cash and cash equivalents, including government bonds. Ethena, issuer of the third-largest onchain dollar product, notably bucks the trend by tethering USDe to the dollar using a cash-and-carry trade.
Earlier this year, Spark deployed about $1.1 billion of its Spark Liquidity Layer balance sheet to Ethena's USDe and sUSDe tokens. It also deployed $25 million into a Maple Finance lending pool, alongside Sky (formerly MakerDAO), and launched a $1 billion Tokenization Grand Prix, designed to accelerate the adoption of tokenized assets on the Spark Liquidity Layer.
The Spark Liquidity Layer automates liquidity provision of the ecosystem's assets, including USDS, sUSDS, and USDC, directly from Sky across various DeFi protocols, enabling users to access the Sky Savings Rate more readily.
There is over $9 billion deposited into Sky's sUSDS, the "savings token" counterpart to the decentralized USDS stablecoin. The token is generating approximately 4.8% APY, funded by Sky revenue.
Meanwhile, Superstate's fund trades spot and futures Bitcoin, Ethereum, Solana, and XRP markets, and currently generates a 30-day yield of 8.35%. Superstate also manages USTB, a tokenized fund backed by US Treasurys.
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