Spool Protocol

Spool Protocol serves as DeFi middleware, that allows users to participate in a subset of yield generating protocols in a risk diversified, automatically managed, and efficient fashion.

Spool

• A Spool is a Smart Contract that routes deposits into an array of different Yield Generators in a risk-managed and yield-optimized manner.
• In simple terms, a Spool could be compared to a "traditional DeFi vault”, as both take on the job of managing and compounding capital via a strategy. The key difference is that a Spool can be individually setup by users in a permissionless manner.
• A Spool contains an assigned Risk Appetite, a chosen Risk Model, and a subset of selected Yield Generators. Mind you that a Spool does not hold user funds directly in the contract itself.

Key Features

• Fully Composable DeFi: Spool is an open-ended DeFi toolbox. Create Custom Strategies based on a range of editable inputs. These inputs include an array of Yield Generators, Risk Models, and a certain Risk Appetite.
• Completely Automated: Spool automatically compounds yield and adjusts capital allocation to maximize capital efficiency within the constraints of the parameters and Risk Appetite set by each individual Spool.
• Permissionless & Non-Custodial: 100% Smart Contract-based. Funds will never enter centralized custody.
• Programmable Risk: Select from established Risk Models or create your own and present it to the DAO. If approved, your Risk Model can be used by Spool Creators.
• Earn Fees as a SPOOL Holder: SPOOL stakers partake in governance via voSPOOL and accrue 100% of protocol-generated revenue. 80% of revenue is paid out to stakers directly, the remaining 20% goes to the DAO controlled treasury.
• Earn Fees as a Spool Creator: Spool Creators can set a performance fee (capped at 20% of yield) for themselves on the protocol level, which allows them to earn fees from users joining their strategy in a transparent way.
• White-label solution: End Users can enter and exit Spools through a single point of access either via the Spool App, directly through the smart contract, or via third-party interfaces using the Spool SDK.

Spool Middleware

• Spool is DeFi middleware, which connects users to existing and new Yield Generators & Yield Optimizers. Spool routes TVL to existing Protocols while maintaining freedom & flexibility for its users.
• Good middleware is unnoticeable. Spool operates in the background to the benefit of all participants within the ecosystem. Spools can be seamlessly integrated into UIs via the SDK, allowing professional users like businesses to create white-labeled DeFi products for end-users who are unaware of using Spool.

Spool Fees

Spool only charges performance fees. In order for a Spool user to pay a fee, there's one main condition that must be met:

• Amount withdrawn > Amount deposited

This means that Spool users only pay fees-on-profit if they have made profits from participating in that Spool.