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The study highlights how Aave’s infrastructure serves as a foundational layer for other protocols' financial products.
February 6, 2026
Aave has released a case study in collaboration with Cap Money, detailing how the protocol has matured into a yield benchmark for the broader DeFi ecosystem.
The study examines how Cap Money builds directly on Aave, using it as a primary yield source. Specifically, Cap Money's Credit Engine integrates Aave’s interest rates to power its own offerings.
This partnership signals a key trend in DeFi where established protocols like Aave are becoming foundational infrastructure. Rather than just being a standalone application for users, Aave is providing the base rates and liquidity that other financial products and protocols are building upon. The case study reinforces Aave's strategy of becoming an essential utility layer within the decentralized economy.
Aave has released a case study in collaboration with Cap Money, detailing how the protocol has matured into a yield benchmark for the broader DeFi ecosystem. The study examines how Cap Money builds directly on Aave, using it as a primary yield source. Specifically, Cap Money's Credit Engine integrates Aave’s interest rates to power its own offerings.
Less than six months after launch, Cap (Covered Agent Protocol) has grown its total value locked to $500 million and deployed more than $360 million of USDC onto Aave V3 Core Ethereum, making it one of the single largest suppliers of USDC to the leading DeFi lending market.
Cap issues cUSD, a dollar-denominated stablecoin backed 1:1 by a reserve of regulated stablecoins and tokenized money-market funds. Holders can stake cUSD to receive stcUSD, a yield-bearing receipt token that has already distributed $4 million in cumulative yield. More than half of all outstanding cUSD is currently staked.
Cap outsources yield generation to a network of institutional operators — banks, high-frequency trading firms, and market makers — who borrow from the protocol’s Credit Engine. Every loan must be covered by escrowed capital posted by professional risk underwriters in Cap’s Financial Guarantee Market. If a borrower defaults, the underwriters’ collateral is used to make stcUSD holders whole.
A dynamic Hurdle Rate sets the minimum yield borrowers must pay. All yield up to the hurdle flows to stcUSD holders; anything above it (after fees) is retained by the borrowing operator. Over the past 90 days the average hurdle has sat at 5.2%.
Cap’s Fractional Reserve contracts automatically sweep idle capital from its reserves into Aave, earning yield that accrues directly to stcUSD holders while preserving a liquidity buffer for cUSD redemptions. More than 90% of stcUSD yield to date has come from Aave.
The protocol also uses Aave’s USDC supply rate as a live market benchmark. The minimum yield required from operators is the higher of (a) a pre-set protocol floor or (b) Aave’s prevailing supply rate. In practice, Aave’s rate has become the binding floor, anchoring Cap’s credit pricing to the deepest, most transparent liquidity pool in DeFi.
Read More:
https://aave.com/blog/cap
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