Staked Saga Dollar (stkD) is an ERC-4626 vault that allows users to stake their Saga Dollar (D) and receive stkD receipt tokens. Assets in the vault are automatically supplied to lending protocols, earning yields and rewards which accrue to stkD. Therefore, stkD represents D lending deposits in integrated lending protocols, similar to other money market-backed YBS.
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stkD’s Token Contract: TBD.
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The stkD vault simplifies user experience for D lenders while providing them with a liquid, yield-bearing, and composable receipt token that can interact with other protocols, potentially unlocking even more utilities and benefits. For example:
Additionally, stkD users also earn Colt points from the Points Program.
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For user instructions, please refer to our User Guide.
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Palomino is the first Saga-native lending protocol integrated by the stkD vault, where D is supplied to generate yield. In the future, more D markets on other Saga-native lending protocols will be considered for stkD vault integrations.
Palomino D deposits are expected to earn above-market stablecoin lending rates thanks to subsidized borrowing demand and high credit utilization. As yield accrues in the vault, its NAV increases, allowing stkD holders to unstake more D from the vault over time.
In addition to D’s reserve quality, the health of D deposits in Palomino is critical to the stkD vault’s overall integrity. If Palomino were to incur bad debt from failed collateral liquidations, D lenders—and by extension stkD holders—could be exposed to potential losses. To mitigate this, Colt and Palomino collaborate closely on shared risk management, adopting conservative protocol parameters and policies that prioritize safety for D lenders/stkD users. For example: