> For the complete documentation index, see [llms.txt](https://stasis-finance.gitbook.io/stasis-docs/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://stasis-finance.gitbook.io/stasis-docs/overview/what-is-stasis.md).

# What is Stasis?

Stasis is a protocol maintaining **rSTS**, a yield-bearing token backed by USDC and designed to generate stable returns through delta-neutral strategies.

The protocol's main features include:

* Issuance and redemption of **rSTS** against USDC deposits;
* Maintaining delta-neutral positions through perpetual futures on Hyperliquid;
* Generating stable yield (5-6% APY) through funding rate arbitrage;
* **Auto-compounding** mechanism that automatically reinvests earned yield.

Both deposits and withdrawals can be executed by users on a 1:1 basis with USDC, while the rSTS token automatically accrues value over time through the protocol's yield generation activities.

## Core Architecture

```
+---------------------+        +--------------------------+        +--------------------------+
|  User Deposits      |        |     Stasis Vault         |        |     Vault Wallet         |
|     (USDC)          | -----> |   (Mint rSTS Token)      | -----> |   (USDC Holding)         |
+---------------------+        +--------------------------+        +--------------------------+
                                                                     |
                                                                     v
                                                           +--------------------------+
                                                           |      Bot Executor        |
                                                           |      (Off-chain)         |
                                                           +--------------------------+
                                                                     |
                                                                     v
                                                           +--------------------------+
                                                           |  Hyperliquid Exchange    |
                                                           +--------------------------+
                                                                     |
                                                                     v
                                                           +--------------------------+
                                                           |  Delta-Neutral Strategy  |
                                                           |  (BUY SPOT / SHORT PERPS)|
                                                           +--------------------------+
                                                                     |
                                                                     v
                                                           +--------------------------+
                                                           |   Yield Accrual Logic    |
                                                           | (Exchange Rate Increases)|
                                                           +--------------------------+
                                                                     |
                                                                     v
+---------------------------+  <------------------------------------+
|  rSTS Redemption          |
|  (User Claims USDC)       |
+---------------------------+
```

## Key Benefits

### 🛡️ Market Neutral

The protocol maintains delta-neutral positions, protecting users from cryptocurrency market volatility while still generating yield.

### 💰 Stable Returns

Target APY of 5-6% through systematic funding rate arbitrage, providing predictable returns in volatile markets.

### 🔄 Auto-Compounding

The rSTS token automatically accrues value as yield is generated and reinvested, eliminating the need for manual claiming.

### 💧 Instant Liquidity

No lock-up periods or withdrawal fees - users can deposit and withdraw at any time based on the current exchange rate.

### 🔒 Non-Custodial

Users maintain full control of their funds through smart contracts deployed on Avalanche, with transparent and auditable operations.

## How It Works

1. **Deposit**: Users deposit USDC and receive rSTS tokens at the current exchange rate
2. **Strategy Execution**: The protocol deploys capital in delta-neutral positions on Hyperliquid
3. **Yield Generation**: Funding rate arbitrage generates consistent returns
4. **Auto-Compounding**: Earned yield is automatically reinvested, increasing the rSTS exchange rate
5. **Withdrawal**: Users can redeem rSTS for USDC at any time at the current exchange rate

## Target Users

Stasis is designed for:

* **Conservative DeFi investors** seeking stable yield without market exposure
* **Institutions** requiring predictable returns for treasury management
* **Yield farmers** looking for consistent, auto-compounding strategies
* **Risk-averse users** who want DeFi yields without cryptocurrency price risk

***

Next: rSTS Token