Key Takeaways
Today, in collaboration with Securitize, Morpho, and Polygon, we launched a levered real-world asset (RWA) strategy, using sACRED on Polygon PoS, the tokenized version of an Apollo-managed multi-asset credit fund.
This collaboration bridges TradFi and DeFi by driving the utility of RWAs onchain, offering enhanced yields currently unavailable in TradFi formats. This highly sophisticated solution enables permissioned sACRED holders to access enhanced yields using our yield optimization engine and permissionless DeFi infrastructure powered by Morpho and Polygon while maintaining appropriate risk parameters.
The first iteration of the strategy is run on Compound Blue (powered by Morpho) on Polygon PoS. Following a successful pilot program, the strategy is expected to expand to Ethereum Mainnet and other chains.
How Does the Levered RWA Strategy Function?
Step 1: Users supply their RWA tokens on Polygon PoS into a Gauntlet-curated vault, which then automatically executes the optimized strategy within a sophisticated risk management framework, eliminating manual position management.
Step 2: The vault deposits the RWA as collateral on Morpho and borrows USDC against it.
Step 3: The USDC is used to purchase more RWA, which is again deposited as collateral on Morpho.
The loop remains active subject to risk levels established by Gauntlet’s quantitative optimization engine, which monitors yield and borrow rates across DeFi.
Gauntlet’s Yield Optimization Engine
We are the leading model provider and vault curator in DeFi, having built and run optimization strategies for tokens, protocols, and chains since 2018.
Leveraging our knowledge base and an expansive track record across cycles, we’ve continuously tuned our risk models to become the premier vault curator in DeFi, monitoring and managing risk across custom yield strategies. Our vaults currently optimize yields on more than $650 million (as of April 2025) in onchain assets across Morpho, Drift, Symbiotic, and Aera, enabling users to retain custody of their assets while benefiting from risk-optimized yields.
We used this track record to design the levered RWA strategy with Securitize, employing data-based backtesting to establish the strategy’s viability. Understanding the mechanics of onchain lending markets and traditional finance credit markets enabled us to develop an onchain levered RWA looping flow to enhance sACRED yields.
To continually optimize and refine this strategy, we track supply and borrow APYs, set appropriate LLTVs, optimize the leverage ratios, and continually assess market health.
What’s Next for sACRED Levered RWA
With the successful rollout of the pilot program, we aim to launch a widely available version of this strategy with Elixir and build on our Securitize partnership. As we seek wider use cases for the levered RWA strategy, we plan to add Elixir’s deUSD to the flow, using it as collateral to expand the strategy and enhance yield opportunities.
To learn more about the Levered RWA Strategy, reach out to Rahul Goyal, our Head of Institutional Partnerships: [email protected].
Gauntlet Team
Blog
View the full presentation
Read the full paper
