Yield & venues

The yield is real, external, and inspectable: deposits are supplied to an on-chain lending venue, and the interest that venue pays is the interest you earn. loom adds accounting, not promises.

The two-layer design

YieldVault owns the accounting. When the PositionManager deposits your principal, the vault mints shares against its total assets; those share IDs live on your receipt. The share math never changes — it uses a virtual-offset formula that neutralizes the classic first-depositor inflation attack, and the final redemption of the pool sweeps residual dust to the last redeemer instead of stranding it.

The adapter owns the venue. AaveV3Adapter holds the interest-bearing aToken; totalManagedAssets() is simply its aToken balance, which rises block by block as Aave accrues supply interest. The vault reads its total assets from the adapter — so yield flows into the share price automatically, pro-rata to every receipt.

share price = totalAssets / totalShares        (grows as the venue accrues)
your claim  = your shares × share price        (what previewRedeem returns)

Swapping venues without touching you

The adapter is hot-swappable. Migrating from Aave to another venue (Spark, Morpho, Fluid — anything an adapter can wrap) is one owner transaction: withdraw everything from the old venue, deploy it into the new one, atomically, with a minimum-assets assertion so a lossy migration reverts instead of silently haircutting shareholders.

Your shares, your receipts, and the lUSD supply are untouched by a migration — they reference the vault, and the vault's accounting never moves. The app names the current venue on every receipt so provenance is always visible.

What the venue means for risk

loom passes the venue through honestly, both directions:

• Yield is whatever the venue pays — variable, never guaranteed, verifiable at the venue's own contracts (the addresses are on the address book).
• Losses pass through too. If the venue returned less than principal, redemptions would return less than principal — with the performance fee waived. loom does not insure venue risk; see Risk disclosures.
• Liveness is inherited: redeeming requires the venue to honor withdrawals at that moment. A paused or illiquid venue delays redemption until it recovers — the receipt market remains open throughout.

One deliberate absence: idle-cash strategies, rehypothecation, or anything that would make "where is my money" a hard question. The answer is always: in the venue, at an address you can check.