Ether.fi Liquid - ETH Yield
not rated yetEther.fi Liquid is an automated DeFi strategy vault built on top of ether.fi's liquid staking infrastructure. The ETH Yield vault provides a simple, single-deposit access point to deploy ETH-denominated assets across a curated set of DeFi protocols for optimized yield.
Users deposit eETH, weETH, or WETH into the vault and receive liquidETH vault shares (a Veda BoringVault ERC-20) whose redemption value appreciates automatically as the vault earns returns through auto-compounding.
How the ETH Yield vault works:
- You deposit eETH, weETH, or WETH into the vault.
- The vault allocates deposited assets across multiple DeFi strategies — currently a leveraged weETH/WETH loop on Aave V3, stablecoins borrowed against weETH on Morpho Blue and deployed into stablecoin yield strategies, plus SparkLend, Fluid, Uniswap V3 and ether.fi's Liquid Monad ETH vault — to optimize yield.
- Earnings are auto-compounded back into the vault, increasing the redemption value of your LP token.
- A small liquidity buffer is maintained to facilitate withdrawals at any time.
- The vault is powered by Veda's BoringVault architecture with Merkle proof-validated strategy execution.
Basic Information
Fundamentals
TVL
APR
Statistics
| Weekly | Monthly | Quarterly | Yearly | All-Time (Indexed) | |
|---|---|---|---|---|---|
Period Start | N/A | N/A | N/A | N/A | N/A |
| Period End (inclusive) | N/A | N/A | N/A | N/A | N/A |
| APR | N/A | N/A | N/A | N/A | N/A |
| APY | N/A | N/A | N/A | N/A | N/A |
CAGR | N/A | N/A | N/A | N/A | N/A |
Volatility | N/A | N/A | N/A | N/A | N/A |
Sharpe Ratio | N/A | N/A | N/A | N/A | N/A |
Sortino Ratio | N/A | N/A | N/A | N/A | N/A |
| TVL High | N/A | N/A | N/A | N/A | N/A |
| TVL Low | N/A | N/A | N/A | N/A | N/A |
Inflows | — | — | — | — | — |
Liquidity
Not calculated yet
Liquidity analysis will be available soon
Strategy
- Deposit ETH-denominated assets
- Deposit eETH, weETH, or WETH into the ETH Yield vault
- Receive liquidETH vault shares representing your share of the vault
- No deposit fees are charged
- Automated yield optimization
- The vault automatically allocates across Aave V3, Morpho Blue, SparkLend, Fluid, Uniswap V3, stablecoin yield strategies and ether.fi's Liquid Monad ETH vault, using leverage on part of the book
- Earnings are auto-compounded to maximize returns
- Strategies are validated through Merkle proofs ensuring only authorized actions are executed
- Withdraw at any time
- Request a withdrawal through the vault's on-chain withdrawal queue (Boring Queue); requests can take up to 3 days to be filled
- No exit fee beyond a ~1 bp solver discount at withdrawal — plus the 0.5% annual platform fee (calculated daily)
- A liquidity buffer is maintained in the vault to facilitate withdrawals
Yield Source
The ETH Yield vault generates returns from multiple sources, combining base Ethereum staking rewards with DeFi strategy returns:
- Base ETH staking rewards — Consensus layer rewards (block rewards and attestation) and execution layer rewards (transaction fees and MEV) from Ethereum PoS validation via eETH/weETH.
- Leveraged staking — weETH supplied and WETH borrowed in Aave V3 E-mode, earning the spread between the staking yield and the WETH borrow rate. (weETH no longer carries EigenLayer restaking rewards — ether.fi removed restaking from weETH in August 2026.)
- Stablecoin carry — Stablecoins (USDC, PYUSD, RLUSD) borrowed against weETH on Morpho Blue and deployed into stablecoin yield/basis strategies; the vault earns the gap between those yields and the stablecoin borrow cost.
- Lending protocol yields — Interest earned from supplying assets to lending markets such as SparkLend and Fluid.
- Liquidity provision fees — Trading fees earned from concentrated liquidity positions on Uniswap V3.
- Auto-compounding — All earned rewards are automatically reinvested back into the vault strategies.
The combined APY is variable — see the live yield statistics on this page. A portion of vault funds sits idle in a liquidity buffer for withdrawals and may earn little to no yield.
Strategy Limits
Deterministic Constraints
- Annual Platform Fee: 0.5% of TVL deducted daily (~0.0014%/day)
- Liquidity Buffer: A portion of funds is kept idle to facilitate withdrawals, reducing overall yield
- Accepted Deposits: Only eETH, weETH, or WETH — must convert other assets first
Probabilistic Constraints
- ETH Price Volatility: The value of underlying ETH-denominated assets fluctuates with market conditions
- DeFi Protocol Risk: Yield depends on performance and security of multiple integrated protocols (Aave, Morpho, Spark, Fluid, Uniswap, etc.)
- Leverage: part of the vault runs looped and borrowed positions, so returns fall when borrow rates rise relative to staking and stablecoin yields
- Variable APY: Returns are not guaranteed and change based on market conditions and DeFi protocol performance
- eETH/weETH Peg Risk: eETH may trade at a discount to ETH during volatile markets
Underlying Assets/Allocations
Allocation per the Veda (Sevenseas) vault API, 1 October 2026 (7-day aggregation). Since July the vault has added a large stablecoin carry leg — stablecoins borrowed against weETH and deployed into stablecoin strategies — alongside its leveraged weETH/WETH loop on Aave.
Risk Analysis
not rated yetPotential Risks
Based on the official ether.fi documentation and PrismaRisk assessment, the following risks are associated with the ETH Yield vault:
- Smart Contract Risk — The vault interacts with multiple third-party protocols (Aave, Morpho, Spark, Fluid, Uniswap, stablecoin yield venues and the Liquid Monad ETH vault), each adding smart contract surface area
- Validator Slashing Risk — Slashing penalties from validator misbehavior are socialized across all depositors with no dedicated bond buffer
- Leverage and Liquidation Risk — The Aave weETH/WETH loop runs close to its liquidation threshold, and the Morpho stablecoin borrows are secured by weETH priced in USD; a sharp ETH drawdown, a weETH exchange-rate loss, or a borrow-rate spike can force deleveraging or liquidations
- Centralization Risk — Core contracts sit behind a 6-of-10 multisig with a 10-day timelock, but the vault's own permissions are controlled by a 4-of-6 Safe without a timelock, and most validator bonds are ether.fi-controlled
- eETH/weETH Depeg Risk — eETH may diverge from 1:1 with ETH during volatile markets; ~76% of weETH supply has historically resided on Pendle
- Oracle Risk — RedStone price feeds aggregate only four data sources concentrated on Balancer pools
- Client Diversity Risk — Approximately 55% of ether.fi validators historically ran Geth, exceeding safe client diversity thresholds
- Withdrawal Delay Risk — Validator exits may take from two days to several months, potentially causing delays if the liquidity buffer is exhausted
Risk Analysis (3rd Parties)
Summary
Ether.fi Liquid ETH Yield vault offers automated ETH yield by combining Ethereum staking rewards with DeFi strategy returns. Since August 2026 weETH no longer carries EigenLayer restaking exposure, and the vault now earns much of its return from leverage: a weETH/WETH loop on Aave V3 and stablecoins borrowed against weETH on Morpho and deployed into stablecoin yield strategies. ether.fi's core contracts were hardened in 2026 (6-of-10 upgrade multisig behind a 10-day timelock, 3-of-3 oracle committee with an on-chain APR cap), and the protocol holds a CertiK "A" rating and multiple audits. Key risks are the vault's leverage and sensitivity to borrow rates, the vault-level admin Safe without a timelock, high historical audit finding counts, and dependency on multiple third-party protocols. Governance is still maturing with full on-chain governance not yet live.
See the PrismaRisk collateral risk assessment for weETH: "weETH Collateral Risk Assessment"
ether.fi's core contracts (eETH, weETH, LiquidityPool) can only be upgraded by a 6-of-10 multisig (7 external signers) behind a 10-day timelock; day-to-day parameters sit with a 4-of-7 multisig behind a 2-day timelock (only pauses are instant). These controls were hardened in April 2026 (previously 4-of-7 with a 3-day timelock), and a Certora-audited role-system upgrade went live on July 14, 2026.
The Liquid ETH vault itself is a Veda BoringVault whose permissions (RolesAuthority) are owned directly by a 4-of-6 Safe with no timelock in between. The strategist can only execute Merkle-whitelisted actions, but that Safe can change roles and permissions without a delay.
weETH's exchange-rate oracle now requires 3-of-3 committee consensus, and every report must also pass an on-chain 5% APR cap — so even a compromised quorum can move the rate only by a small, bounded amount per report.
Leverage: As of October 2026 the vault runs a looped weETH/WETH position on Aave V3 E-mode (health factor ≈1.03) and borrows USDC, PYUSD and RLUSD on Morpho Blue against weETH and Hastra PRIME collateral (health factors ≈1.26–1.48), deploying the stablecoins into stablecoin yield strategies. Returns depend on staking and stablecoin yields staying above borrow costs; a borrow-rate spike or a sharp ETH drawdown would force deleveraging and could trigger liquidations.
April 2026 precautionary pause: After KelpDAO's rsETH bridge was exploited on April 18, 2026 (~$292M of unbacked rsETH), ether.fi paused all Liquid vaults — including Liquid ETH — for about a day, halting deposits, withdrawals and bridging while it deleveraged positions under elevated borrow rates. Liquid vaults held no rsETH, weETH stayed fully backed and no user funds were lost, but the episode shows how the vault's leveraged positions can lead to pauses and slower withdrawals during market-wide stress.
Audit reports from multiple firms are available at: ether.fi Audit Reports Repository
Ether.fi has been audited by 6+ firms including Omniscia, Nethermind, Solidified, CertiK, Zellic, Halborn and Certora (formal verification of the July 2026 security upgrade). CertiK rates the protocol 80.58/100 ("A" rating).
Audit findings across firms included significant issues: Omniscia found 11 major findings, Nethermind found 1 critical and 6 high-severity issues, and Solidified found 3 critical issues. All reported issues have been addressed.
Ether.fi maintains an active bug bounty program on Immunefi and holds the Immunefi Standard Badge. Optional smart contract coverage is available through Nexus Mutual.