# Yield Basis: Solving Impermanent Loss in DeFi by Michael Egorov

- Speakers: [Michael Egorov](https://streameth.org/speakers/michael-egorov)
- Channel: [Stable Summit](https://streameth.org/stable_summit)
- Date: 2025-10-07
- Duration: 22:49
- Watch: https://streameth.org/watch/yt-DdLzIIODgaM
- YouTube: https://www.youtube.com/watch?v=DdLzIIODgaM

## Description

"In our simulations, LPs went from 3% to 20% APR by removing impermanent loss." -  Michael Egorov, Founder, Curve

Impermanent loss has long discouraged crypto liquidity providers—but Curve’s founder is changing that. In this talk, Michael Egorov introduces “Yield Basis,” a mechanism using compounding leverage and rebalancing budgets to eliminate impermanent loss. Backed by real simulations, it shows LPs can earn double-digit APR even in volatile markets—without bleeding value every time prices shift. This is the next evolution in crypto AMMs.

---
00:00 Solving Impermanent Loss
01:46 The Cost of Passive LPing
04:08 Square Root Pricing Is the Problem
05:48 Compounding Leverage Explained
08:50 Volatility Decay and Loss
10:09 Curve’s Crypto Pools and Auto-Management
13:36 Why Concentrated Liquidity Is Hard to Rebalance
15:36 Using Interest Rates to Fund Pool Efficiency
17:47 Simulation Setup and Yield Results
20:58 9% APR in Bear Markets, 20% in Bull
22:35 FX, Gold, and Stable Pairs Next

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