A Guide for Traditional Finance Professionals.
Your clients are asking about digital asset yields. You've heard the numbers—7%, 12%, sometimes 20%—and your first thought is probably: what's the catch?
The catch, historically, has been volatility. Bitcoin's annualised standard deviation exceeds 80%. Even modest allocations can dominate portfolio risk. A 5% Bitcoin position contributes roughly the same volatility as a 25% equity allocation. For wealth managers with conservative mandates, this has made digital assets effectively uninvestable regardless of return potential.
But here's what most TradFi professionals don't realise: the same infrastructure generating these yields also provides tools to hedge away the volatility. The question isn't whether digital asset yields are real—they demonstrably are, backed by $153 billion in total value locked. The question is whether you can access them in a form that fits conventional portfolio construction.
This guide explains where DeFi yields come from, why they exist, and how sophisticated operators transform volatile crypto exposure into risk-adjusted returns that actually improve portfolio metrics.
The yield landscape: What's actually available
Before diving into mechanics, let's establish the current opportunity set. These are real yields available today across established protocols:
