Yearn launches ySplitter, letting depositors earn vault yield in a different token via Katana integration

Yearn Finance has introduced ySplitter, a new feature that lets users deposit into Yearn vaults but receive their yield in a different token, enabled through an integration with the Katana yield-splitting protocol on the Katana zk-rollup chain. Yearn’s post shows an example vault (vbUSDC on Katana) where depositors provide one asset (such as a USD-pegged token) while the strategy routes and converts the yield stream into another asset before it is paid out to the user. This effectively decouples the deposit asset from the reward asset at the vault level, so users no longer need to manually harvest and swap yields to gain exposure to a different token. The context is Yearn’s expansion onto Katana, a DeFi-focused zk-rollup that markets itself around low fees, fast confirmations, and an “innovative liquidity flywheel,” making it suitable for more granular yield routing and on-chain conversions. By plugging into Katana’s infrastructure, ySplitter can programmatically split and redirect yield flows on L2, using swap/liquidity venues on Katana to deliver rewards in alternative tokens while leaving principal deposits untouched. For Yearn, this is a product-layer evolution: it moves vaults beyond simple auto-compounding into configurable “yield as a service,” where DAOs, protocols, or users can design vaults that pay yield in governance tokens, ecosystem incentives, or a chosen stablecoin without changing the underlying collateral. This matters because it pushes DeFi toward customized yield flows and more capital-efficient incentive design. Protocols can structure vaults that, for example, attract stablecoin deposits but pay out in their native token, or allow treasuries to hold conservative assets while receiving yield in a risk-on asset for growth. For users, it simplifies strategies that previously required multiple contracts and manual management: they can set a preferred reward token at deposit (where supported) and let the vault handle swaps and compounding logic on Katana’s low-cost infrastructure. In the broader ecosystem, this type of yield abstraction is part of a trend toward modular, programmable cash flows in DeFi—akin to “streaming” or “tokenized yield”—but implemented directly at the vault architecture level via Yearn and Katana.

✨ AI-generated background, compiled from web sources — not editorial content.

More coverage

• Integrations | Katana (support.katanamrp.com)
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• vbUSDC - Yearn Vaults (yearn.fi)
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• Katana: Yearn Net Deposit Flows - Analytics Dashboard - Blockworks (blockworks.com)

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