On-Chain Yield

Definition ∞ On-chain yield represents the returns generated from digital assets directly through activities conducted on a blockchain. This can include rewards from staking, interest earned from lending protocols, or revenue from providing liquidity in decentralized exchanges. Such yields are typically denominated in cryptocurrencies and are transparently verifiable on the ledger.
Context ∞ The discussion surrounding on-chain yield often centers on its sustainability, risk factors associated with different yield-generating protocols, and its attractiveness relative to traditional financial instruments. News coverage frequently highlights the yields offered by various DeFi protocols, the potential for smart contract exploits to impact yield stability, and the increasing interest from institutional investors seeking yield opportunities within the digital asset space.