Earnings Account
Earnings Account help and FAQs from Moneda on your self-custody account, stablecoins, transfers, security, and AI agent.
The Moneda Earnings Account allows you to earn passive income by depositing fiat currency, which is converted into stablecoins and supplied to Morpho, a third-party decentralised financial (DeFi) lending platform. On Morpho, borrowers pay interest on their loans, and this interest generates the returns you earn on your deposits. Your balance grows automatically through real-time, auto-compound interest, and you can withdraw your funds and earnings at any time. The Moneda Earnings Account provides a clear view of your deposits, accrued interest, and average APY in real time.
The USD Moneda Earnings Account leverages Morpho’s Spark USDC Vault on the Base blockchain. When you deposit USD, it is converted into USDC and supplied to Morpho. Borrowers on Morpho pay interest on their loans, and this interest is distributed to you as earnings. The EUR Moneda Earnings Account leverages Morpho’s Steakhouse EURC Vault, on the Base blockchain. When you deposit EUR, it is converted into EURC and supplied to Morpho. Borrowers on Morpho pay interest on their loans, and this interest is distributed to you as earnings. The rates you earn are dynamically determined by market supply and demand, providing a steady and transparent way to grow your funds.
The Moneda Earnings Account offers higher interest because it uses blockchain, which operates differently from traditional financial services.
- Open and Transparent Markets: Interest rates are driven by real-time supply and demand, allowing lenders to earn competitive returns directly from borrowers.
- No Intermediaries: Blockchain removes banks and other middlemen, reducing operational costs and passing more of the returns directly to you.
- Higher Liquidity: Decentralised Applications provide instant access to funds for borrowers and lenders, creating a dynamic, 24/7 global marketplace that attracts higher-paying borrowers that need instant access to liquidity for activities like trading or earning returns elsewhere. Borrowers also provide more collateral than they borrow, which limits supply and keeps demand high.
- Efficient Operations: DeFi platforms use smart contracts, which automate financial services with minimal overhead, further enabling higher returns for lenders whilst borrowers benefit from the speed of execution. These factors create an efficient, open financial system where you can earn higher interest compared to traditional savings accounts.
No, returns are not guaranteed. The interest rate (APY) is dynamic and depends on:
- The demand for borrowing.
- The amount of money lent. As these factors fluctuate, so do your earnings. However, Morpho’s overcollateralisation and real-time risk management mechanisms minimise the risk of borrower default.
APY stands for Annual Percentage Yield. It shows the total return you can earn on your funds in a year, including the effect of compounding interest. For example, if you earn a 5% APY, your earnings will grow faster because the interest is reinvested over time. In your Moneda Earnings Account, the APY reflects your potential returns based on market conditions. Interest on your deposit is:
- Dynamic: It changes based on Moneda Earning Account’s variable interest rates.
- Auto-Compounded: Earnings are added to your balance continuously, meaning you earn interest on both your initial deposit and previously accrued interest. For example, if the APY is 5% and your balance grows to $1.010, your future earnings will be calculated on $1.010, not just the initial deposit.
The APY offered by Moneda Earnings is dynamic and adjusts in real time based on market conditions. Historically, returns have ranged between 4% and 18%, but this may vary depending on supply and demand dynamics. To view the current APY, simply check your Moneda Earnings account.
Earnings are accrued in real time every second and automatically reflected in your Moneda Earnings Account balance. You won’t receive discrete payments; instead, your balance grows continuously as interest accrues.
Borrower defaults are managed through Morpho’s overcollateralisation and liquidation mechanisms: • Overcollateralisation: Borrowers on Morpho are required to deposit collateral worth more than the loan they take. For example, if a borrower wants to borrow $100, they might need to deposit $150 in another supported digital asset. • Liquidation Process: • If the value of the collateral falls below a certain threshold (eg. 80%) due to market fluctuations, the protocol automatically enables any third-party (i.e Liquidators) to trigger a liquidation of the borrower’s collateral. • The collateral is then sold to repay the borrowed amount, ensuring lenders are compensated. • Liquidators are incentivised though a small commission to detect and liquidate positions of borrowers with bad debt. • Risk of Loss: While these mechanisms minimize risk, extreme market events or smart contract vulnerabilities could lead to partial losses. However, such occurrences are rare, and Morpho’s track record demonstrates strong reliability in protecting lender funds.
If the liquidated collateral amount is insufficient to cover the loaned amount (aka. “bad debt”) in a Vault, Morphos’ protocol tracks the loss so that third-parties can inject the missing funds (via a "deposit on behalf" mechanism) and ensure lenders aren’t stuck. • Worst-Case Scenario: In case of a large-scale shortfall event (e.g., due to extreme market volatility or liquidation failures) any third-party can decide to allocate funds to cover the bad debt or other recovery mechanisms to compensate lenders. In case the debt is still not covered, this bad debt amount is deducted from the vault’s "available assets" for withdrawals, so lenders can only redeem the part of their funds that are not associated with the bad debt.
While Moneda Earnings minimises risks by using Morpho, a well-established and audited DeFi protocol, no investment is entirely risk-free. Morpho has one of the best risk ratings in the ecosystem and has been praised for its focus on quality, protocol maturity and design. Key risks include: • Smart Contract Risk: Vulnerabilities in the Morpho’s money market protocol, the oracles used or the Base network. • Liquidity Risk: Limited pool liquidity during periods of high borrowing or market volatility. • Stablecoin Risk: Potential de-pegging of the stablecoin from the US dollar or Euro. • Regulatory Risk: Changes in laws affecting DeFi or stablecoins. Moneda actively monitors and mitigates these risks but cannot eliminate them entirely. You can learn more about the risks involved in Morpho at https://morpho.org.
• Overcollateralisation: Borrowers on Morpho must provide collateral worth more than the value of their loans, reducing default risk. • Audited Protocol: Morpho is a platform with a proven track record and regular audits. You can see their audit reports and verifications at https://morpho.org. • Monitoring: Moneda continuously monitors the health of Morpho protocol and the Base blockchain network to minimise exposure to adverse conditions.
The Smart Earnings Account is an enhanced Moneda savings option that uses the YO yield optimiser on Base to maximize your earnings. When you deposit money (USD or EUR) into a Smart Earnings Account, Moneda converts it into stablecoins (like USDC for USD or EURC for Euros) and deposits them into YO’s vaults (called yoUSD and yoEUR). The YO Protocol then automatically allocates these funds across different decentralized finance (DeFi) strategies to earn interest. In simple terms, it’s a “smart” account because it diversifies and optimizes your deposit across many yield opportunities, all behind the scenes. Your balance still grows through real-time, auto-compounding interest, and you retain the ability to withdraw your money (plus earnings) at any time, just like with the standard Moneda Earnings Account.
Both accounts let you earn passive income, but the Smart Earnings Account takes a more advanced approach to generate potentially higher returns. The regular Moneda Earnings Account typically supplies your funds to a single lending protocol (e.g. one lending pool on Base), which is a straightforward and lower-risk strategy. In contrast, the Smart Earnings Account leverages a yield optimiser, meaning your funds are spread across multiple DeFi platforms and strategies rather than sitting in one pool. This diversification allows for higher yield opportunities (since the optimiser finds the best rates across the market) but also comes with a slightly higher risk profile due to the broader range of protocols involved. In summary, the Smart Earnings Account is designed for those seeking better yield and are comfortable with a more dynamic strategy, whereas the standard Earnings Account sticks to a simpler, more conservative approach.
When you deposit into a Smart Earnings Account, your funds enter YO’s vault, which then spreads your assets across various yield-generating pools in DeFi. YO continuously monitors dozens of lending markets, liquidity pools, and other yield sources across multiple blockchains (like Base, Ethereum, etc.) to find where your money can earn the best risk-adjusted return. The protocol continuously monitors and rebalances to optimise yields – it shifts funds out of lower-yield or higher-risk pools and into better-performing ones. As those underlying pools generate interest (or other rewards), that yield is passed back into the vault and compounds to increase the value of your holding. YO works in the background to make sure your deposits are always deployed in profitable and reliable opportunities. Your returns come from the interest and rewards that borrowers, trading fees, or incentive programs pay in those DeFi pools. All of this happens automatically, so you simply see your Smart Earnings balance grow over time (in USD or EUR, depending on your currency) as those earnings accumulate.
The Smart Earnings Account often advertises higher APYs than traditional savings or even the standard Earnings Account because of how intelligently it deploys your funds. Several factors enable these superior yields: • Broader Opportunities: Instead of relying on a single source, the yield optimiser scours hundreds of yield alternatives across various protocols and networks to find the best rates. It is blockchain-agnostic and protocol-agnostic, meaning it can allocate funds wherever the top yield is, whether on Base, Ethereum, or elsewhere. By tapping into a wide range of opportunities (from lending platforms to liquidity pools), it captures returns that a single-platform strategy might miss. • Active Optimization: The yields are not static, the allocator of the Smart Earnings Account, YO, actively manages and rebalances the vault’s portfolio to capitalize on changing market conditions. Every day (and whenever the benefit outweighs costs), the yield optimiser algorithm shifts your assets from lower-yielding spots to higher-yielding ones. This continuous optimisation means your money is always working in the most productive place, without you having to constantly move funds yourself. • Capturing Incentives: Many yield-generating strategies come with extra rewards (for example, bonus tokens or fee incentives for providing liquidity). The Smart Earnings Account, via YO, automatically captures these additional rewards and adds them to your earnings. By collecting and compounding such rewards, the overall interest rate you earn is higher than just base lending rates. Additionally, these high yields are enabled by the nature of DeFi markets: they operate 24/7 with competitive supply-and-demand dynamics and no traditional banking overhead. That open market environment itself tends to offer higher baseline rates than a traditional savings account.
Yes. One of the key features of the Smart Earnings Account is that it supports Euro deposits in addition to USD. If you deposit euros, you invest them through YO’s euro vault (yoEUR). This means you can earn yield on your euro balance just like you would on a dollar balance. Your earnings will accrue in EUR, increasing your euro-denominated account balance over time. By using the Smart Earnings Account, European currency holders can earn meaningful passive interest on their euros.
Yes, you generally have on-demand access to your money. The Smart Earnings Account is designed to be as liquid as a normal Moneda account, with no fixed lock-up periods. The Smart Earnings portfolio keep a small percentage of their assets idle as a liquidity buffer (around 5%) specifically so that most withdrawals can be fulfilled instantly. In practice, for typical withdrawal amounts, you will be able to withdraw your full balance (principal + earnings) at any time through Moneda, and they will be accessible immediately. The only time you might experience a short delay is if you withdraw a very large amount relative to the yield optimiser’s liquidity. In that case, if your request exceeds the yield optimiser’s instant liquidity buffer, the remaining funds need to be pulled out from the underlying DeFi protocols. When this happens, your withdrawal request gets queued by the YO Protocol and those funds will be redeemed from the yield strategies within roughly 24 hours. There’s no action needed on your part. As soon as the protocol frees up the liquidity (by selling off or withdrawing funds from those protocols), the stablecoins are delivered to your Moneda account automatically. This process ensures that even large withdrawals are handled safely, though it introduces a minor time lag. Importantly, there are no penalties or fees for withdrawing, and no long-term lock-ups. This it’s just a mechanism to maintain stability in the portfolio. For the vast majority of users and normal-sized withdrawals, you’ll experience it as if it were any regular withdrawal, with your money available when you need it.
While the Smart Earnings Account is a great way to earn high yields, it is not risk-free. It involves DeFi protocols and smart contracts, so you should be aware of the key risks before investing. Here are some important considerations: • Smart Contract & Protocol Risk: The Smart Earnings strategy relies on smart contracts – both those of YO and of the many DeFi protocols it invests in. Any bug or exploit in these contracts could potentially lead to a loss of funds. Likewise, if any underlying protocol fails or is hacked, the portion of funds allocated there could be affected. YO mitigates this by using audited contracts and a curated whitelist of reputable pools, but no contract is 100% safe. • Liquidity Risk: Because your funds are invested across various platforms, there’s a possibility of encountering liquidity issues. For example, if many users withdraw at once or if an underlying pool suddenly has low liquidity, it might become temporarily hard to pull funds out quickly. YO attempts to minimize this with its liquidity buffer and FIFO withdrawal queue (so most withdrawals are instant and large ones are queued in an orderly way) Still, in extreme market conditions, access to funds could be delayed or, in a worst-case scenario, a portion of funds might not be immediately retrievable until markets normalize. • Stablecoin Risk: The Smart Earnings Account uses stablecoins (USDC for USD, EURC for Euros) as the currency of investment. These are intended to hold a 1:1 peg with fiat currency, but there’s a risk that a stablecoin could de-peg. For instance, if USDC or another underlying stablecoin were to significantly lose its value or redeemability, it would directly impact the value of deposits. While USDC and EURC are among the more trusted stablecoins (fully reserved and regulated), this risk is not zero. • Cross-Chain and Integration Risk: YO operates across multiple blockchains and DeFi protocols. This means it sometimes uses bridges or cross-chain liquidity to move assets to where yields are highest. Cross-chain operations carry the risk of bridge vulnerabilities. If a bridge used by YO is exploited, funds in transit or on other chains could suffer losses. Additionally, the more protocols involved, the more points of failure can exist (from price oracles to governance attacks on those protocols). YO’s approach of continuous risk monitoring and using only vetted strategies helps reduce exposure to problematic platforms, but it can’t eliminate the complexity risk entirely. • Market & Interest Rate Risk: The yield you earn is variable, not fixed. If market conditions change (for example, a DeFi yield opportunity dries up or rates drop because lots of capital floods into the same strategy), your APY will go down. In extreme cases, certain strategies could even yield negative returns momentarily (though YO would likely rotate out of those). Also, extreme volatility or events in crypto markets might indirectly affect your earnings or temporarily the value of reward tokens that contribute to your yield. How YO mitigates risk: The YO Protocol is built with several safety-oriented features. Its contracts have been independently audited, and it operates under conservative governance (secured by multi-signature controls and an active bug bounty program). YO also uses Exponential.fi’s risk ratings to evaluate each pool it invests in; if a particular strategy’s risk score worsens (due to a hack, instability, etc.), YO can automatically reduce or halt exposure to it. The vault is diversified across many strategies, so not all your eggs are in one basket. These measures significantly reduce the overall risk compared to chasing high yields on your own. In fact, since launch YO’s yoUSD vault has delivered ~8.6% annualized returns with near-zero volatility and no negative months recorded – a testament to its balanced, risk-aware approach. However, it’s important to understand that no system is entirely without risk. You should only invest an amount you’re comfortable with and consider your own risk tolerance. Moneda will continue to monitor the Smart Earnings Account’s performance and the underlying protocols to help keep your funds as secure as possible, but ultimately, higher yield DeFi products do carry higher risk than a savings account.
