Overview
As part of the scheduled quarterly review of the DeFi Growth Index (DGI), we present the proposed constituent adjustments for the Q1 2026 rebalance. This review ensures that DGI continues to track innovative, early-stage DeFi projects with sustainable growth potential, in line with the index’s stated objective and inclusion criteria.
Based on the quarterly review, we propose:
-
Removal of Euler (EUL) due to stagnation in market share and intense competition from next-gen lending protocols.
-
Removal of Clearpool (CPOOL) due to the underwhelming performance of the Ozean launch and aggressive moves by competitors in the institutional credit space.
-
Addition of YieldBasis (YB), a novel BTC liquidity protocol that eliminates impermanent loss and demonstrates deep synergy with the Curve ecosystem.
Removal: Euler (EUL)
-
Rationale:
-
Market Share Erosion: Euler’s growth has stagnated, with its market share shrinking throughout Q4 2025.
-
Competitive Lag: The protocol is being outpaced by competitors innovating rapidly in the lending space. Aave recently rolled out its umbrella model and v4 with expanding RWA markets; Morpho has successfully launched v2; and Fluid is capturing stable swap market share through its smart debt/collateral design.
-
Innovation Deficit: In this fast-moving environment, Euler currently lacks the distinct innovative elements required to reverse this downtrend.
-
Removal: Clearpool (CPOOL)
-
Rationale:
-
Underwhelming Product Launch: The launch of Ozean, intended as the institutional liquidity layer for on-chain financing, has been somewhat underwhelming and failed to capture the expected market momentum.
-
Competitive Disadvantage: Competitors are executing more aggressive integration strategies. Maple Finance is actively expanding the reach of syrupUSDC and syrupUSDT by integrating them into new protocols like Midas and ecosystems like Plasma & Solana, effectively siphoning liquidity demand.
-
Market Positioning: Meanwhile, Wildcat is successfully pivoting to become a liquidity hub for on-chain hedge funds by working closely with on-chain risk curators such as Hyperrithm. This leaves Clearpool in a difficult position, squeezed between Maple’s broad integrations and Wildcat’s specialized pivoting.
-
Addition: YieldBasis (YB)
-
About YieldBasis:
YieldBasis is a liquidity protocol built on Curve infrastructure that introduces a “Zero-Impermanent Loss” automated market maker (AMM) for Bitcoin. It utilizes 2x leverage via crvUSD borrowing and automated rebalancing to allow LPs to track BTC price 1:1 while earning organic yields, effectively solving one of the largest pain points in BTC DeFi. -
Growth Evidence:
-
Immediate Traction: Since its launch in Q4 2025, YieldBasis has demonstrated exceptional product-market fit, rapidly surpassing $130M TVL.
-
Revenue Generation: The protocol successfully activated its fee switch in late December 2025, validating its economic model and driving demand for the governance token.
-
-
Strategic Synergy & Ecosystem Impact:
-
Curve Infrastructure Enhancement: YieldBasis creates a highly symbiotic relationship with Curve Finance. By utilizing crvUSD for leverage, it directly enhances the stablecoin’s utility, deepens its liquidity, and drives borrowing adoption.
-
New Revenue Stream: This integration opens an additional revenue stream for the Curve ecosystem through increased borrowing fees and utilization.
-
Peg Stability: While the protocol’s rebalancing mechanism introduces volatility within small time windows, the design creates structural demand that supports the crvUSD peg over the longer term, contributing to the overall health of the ecosystem.
-
Next Steps & Timeline
-
Jan 8 - Jan 12, 2026: Gather community and delegate feedback on the proposed basket adjustments.
-
Jan 13, 2026: Confirm the final weightings based on the market caps and initiate the on-chain vote for rebalancing.