Mellow

Behind every earn product is a vault, but most people picture it as a yield wrapper. It's like calling a bank a place to park cash – technically true but it misses the point completely. Yield is just the output. The real job is managing capital under a mandate.

For years, institutions were looking for delegated manager selection, single line on the balance sheet, and full transparency living in one product. Going onchain is finally making that combination possible. In traditional finance, fund-of-funds delivered the first two of these features at the cost of the visibility. Asset managers reported to the fund, the fund reported to investors in a quarterly letter, and that was enough for allocators to stop taking that trade. At the 2007 peak, roughly 150 fund-of-funds firms managed a billion dollars or more but today there are only about 50. Total assets fell from $1.1 trillion around 2008 to under $600 billion in 2026. Mellow Core Vaults have the same logic with visibility issue removed where every allocation is fully transparent and tracked onchain. Each Vault acts like a container, where multiple strategies, each curated by their own manager, live under one mandate enforced at the contract level. Allocator doesn't have to choose an asset manager, he can have many at the same time, picked and overseen by the Vault curator. When a new strong strategy appears it ends up inside the Vault, weak ones can be removed just as easily. All this happens under the same Vault and allocator doesn't have to make a move. @LidoFinance's EarnETH and EarnUSD already work this way on Mellow. One Earn product for ETH, one for stablecoins, with deposits routed across curated strategies underneath. The same model works for any institution that wants to offer onchain yield without relying on a set of third-party products. A neobank, exchange, wallet, or asset manager can keep the product under its own brand, define what it is allowed to do, and appoint specialist managers underneath. For the end user, it remains one product, but for the institution, it is infrastructure that allows managers and allocations to be changed without changing the mandate or starting over again. This is what fund-of-funds were meant to be, and onchain that model finally works.

1/ @mellowprotocol vaults, now native to Para's wallet stack Teams building with Para can enable idle balances to become an actively managed position, without needing to run a bespoke earn product Available out of the box 🏦

Adding native Mellow Vaults access to that stack turns a wallet into an onchain Earn product. What started as a place to hold funds is now a treasury. The balance that used to sit idle becomes an actively managed onchain balance sheet. Get started: docs.getpara.com/v3/walkthrough…

Para gives developers the full wallet and authentication stack: sign-in, embedded wallets, transaction flow, and support for users who connect with MetaMask, Rabby, or another wallet. Use the SDKs and APIs, or skip the UI and drive it all server-side.

When a neobank, wallet, broker, or tokenized asset platform is building their onchain finance app, they don’t build the whole DeFi stack from scratch. Mellow is teaming up with @get_para to make vault access easier for them, bringing it right inside the apps built using Para.

Mellow is partnering with @savantchat to add AI audits to our workflow. Multi-Agent AI gives the team a faster way to run intermediary security checks and review major code changes. Not a replacement for a full audit, but an extra security layer at a fraction of the cost.

Lido EarnUSD deposits have hit $30m, up +300% in the last month. In the same period, the EarnUSD vault APY has climbed to +7% for USD-denominated deposits.

A $30M in TVL milestone was reached by @LidoFinance's EarnUSD Vault on Mellow. The USD-denominated Lido Earn vault is now sitting at a 7-day average APY exceeding 7%, with deposits open in USDT and USDC. Check out the Vault: app.mellow.finance/vaults/earn-usd stake.lido.fi/earn/usd/depos…

Tokenization creates the asset, it doesn't create the management layer around it. For an allocator holding more than one of these, that layer is what actually matters.

This week saw the first 100 days of @LidoFinance's EarnETH and EarnUSD Vaults. They brought almost 90,000 ETH in EarnETH and almost $30M in EarnUSD, the first experience, and the first conclusions. Core Vaults architecture gave the Lido and Mellow teams freedom to add whatever venue made sense: these first days included lending and leverage on @aave and @sparkdotfi, stablecoin yield through @ethena_labs and @maplefinance, running across Ethereum mainnet and @Plasma. The first hundred days brought over $100M+ combined. Hollywood calls that a blockbuster. We call it day 100.

Kelp incident stRATEGY Vault compensation. Following the Kelp incident earlier this year, the strETH holders who stayed in the stRATEGY vault rather than migrating to earnETH have now been compensated. earnETH Vault losses were already covered through @LidoFinance 's coverage at the time. A smaller group of strETH holders sat outside that scope, so Mellow has distributed additional strETH to those holders retrospectively, covering the loss for that period in ETH terms. Uniswap v4 and Pendle cases will have separate handling, which will be processed shortly.

Settlement creates stablecoin balances. Then they become balance sheets that have to be managed. Mellow founder @s0xn1ck joined @1inch to explain why RWAs are the first step and DeFi is moving into fintech’s core.

Read more: mellowprotocol.substack.com/p/core-vaults-… The full doc: docs.mellow.finance/core-vaults-fo…

None of this kills stablecoin yield. It just moves it – out of the coin and into the product layer, where the strategy, the mandate, and the controls live around the dollar instead of inside it. Mellow runs the vault layer that holds them.

Stablecoin yield is getting the regulation TradFi has been waiting for, but it comes with a catch. Yield for simply holding a stablecoin is on its way out. Yield from what that stablecoin actually does is fine. That is exactly the form institutional capital can touch.