Gyroscope (Gyro)
About
Gyroscope is a non-custodial liquidity engine that combines passive concentrated liquidity pools (Elliptic CLPs / E-CLPs) with a fully-backed, all-weather stablecoin called Gyro Dollars (GYD). It serves liquidity providers seeking efficient swap-fee yield from both volatile and stable pairs, as well as users seeking a decentralized stablecoin with automated risk controls and diversified reserve backing.
Where Does Yield Come From?
Gyroscope offers three main ways for users to earn yield.
1. Swap fees from liquidity pools
Gyroscope runs a type of automated market maker (a tool that lets people trade tokens). When traders pay a small fee for each swap, that fee goes to the liquidity providers (people who deposited tokens into the pool).
- For volatile pairs (tokens that move a lot in price), Gyroscope uses several pool designs — 2-CLP, 3-CLP, and Dynamic CLP. These are set to wide price ranges and higher fees, making them a more hands-off strategy for LPs. Price rates are updated by automated "keepers" that pull data from Chainlink oracles.
- For stable pairs and trades involving the GYD stablecoin, Gyroscope uses Elliptic CLPs (E-CLPs). These are asymmetric pools shaped along an ellipse curve, which uses capital at least 75% more efficiently than the older Stableswap design.
In both cases, trades get routed through Balancer's Smart Order Routing system.
2. Yield from the GYD stablecoin reserve
The GYD stablecoin is backed by a diversified basket of assets held by the protocol. That reserve is itself deployed into liquidity pools. The swap fees earned by those deployed reserves boost the protocol's collateralization ratio (the amount of backing per coin). Those earnings can also be passed on as yield to sGYD holders — users who stake their GYD.
3. Rehype E-CLPs (layered yield)
Rehype E-CLPs take the LP position and automatically re-hypothecate (re-use) those assets in lending protocols like Aave — for example, turning deposited tokens into aUSDC. This lets LPs earn three yield sources at once in a single position:
- Swap fees from the concentrated liquidity pool
- Lending yields from the external protocol
- Any extra token incentives from those markets
All of this is managed transparently at the routing and front-end level.
Extra incentives
- GYFI is Gyroscope's governance token. It can be distributed as extra rewards to LPs and GYD holders.
- Governance may also activate a buy-and-burn mechanism — using protocol revenues to buy GYFI on the open market and remove it from supply — through the Conditional Cashflows system.
Finally, a small protocol fee may be taken from LP swap fee revenue to support the system.
Persons
Ariah Klages-Mundt
Core team, FTL Labs
Lewis Gudgeon
Core team, FTL Labs
Daniel Perez
Core team, FTL Labs
Steffen Schuldenzucker
Core team, FTL Labs
Jonas Klemm
Core team, FTL Labs
Audits
| Audit / Date | Findings | Verdict |
|---|---|---|
Nethermind20-05-202503-06-2025 |
| The audit found no high or critical risks; the single low-severity issue was mitigated through documentation, and both informational findings were fixed. This suggests the audited contracts are safe for deployment within the documented usage constraints. |
Nethermind29-01-202526-02-2025 |
| The audit found no critical, high, or medium severity vulnerabilities, with only one low-severity finding (lack of pausing, acknowledged) and one best-practice finding (unused events, fixed), indicating a solid codebase for the GYFI airdrop mechanism with minimal residual risk. |
Nethermind14-06-2024 - 25-06-2024 |
| The audit found only a single low-severity issue regarding an inaccessible state variable setter, which the team promptly fixed, leaving no unresolved findings. The bridging contracts are well-scoped and thoroughly tested, presenting a low risk profile for deployment. |
Nethermind01-07-2024 - 18-07-2024 |
| The audit found no critical or high-severity issues; the single Medium (L2 DOS via stream-spamming) and all other findings were fixed by the team, indicating a well-secured codebase before deployment. |
Nethermind24-07-202315-08-2023 |
| The audit found no critical or high-severity issues, and all medium and low findings were remediated in the final report, confirming that the Gyroscope protocol's core stablecoin and reserve mechanisms are well-secured for launch. Two acknowledged informational items (external action execution and withdrawal timing) present minor residual UX and procedural risks that the team has accepted. |
Nethermind27-03-202315-08-2023 |
| The Nethermind audit revealed 3 critical voting-power manipulation vulnerabilities and 5 high-severity issues; all except one acknowledged informational finding were remediated by the Gyroscope team, leaving the governance system in a substantially strengthened security posture for deployment. |
Nethermind17-08-2022 |
| No critical, high, medium, or low severity issues were found; the audit confirms the CEMM mathematical core has no exploitable security flaws, with all findings limited to informational notes and best-practice improvements, most of which were fixed before the final report. |
Nethermind17-08-2022 |
| The Nethermind audit found no critical or high-severity issues, and all six medium-severity findings were resolved by the Gyroscope team before the final report, demonstrating a thorough remediation process. The codebase was described as well-written with an extensive test suite, reflecting a solid security posture. |
Trail of Bits15-09-2022 |
| The audit identified two critical-class (High) arithmetic and safety-check flaws that were remediated before deployment, and the protocol benefits from extensive whitepaper specifications and property-based testing; residual risks include a small number of unaddressed informational/undetermined items and reliance on privileged roles (governor, reserve managers). |
Runtime Verification27-04-2022 |
| Runtime Verification found critical integration and math-implementation bugs across the P-AMM, CEMM, and LP-pricing components, all of which the Gyroscope team addressed before a subsequent audit by a different firm. The report's narrowly scoped focus on math-model correctness means other parts of the protocol (oracles, exchange code, broader integration) require separate audits, but the core numerical flaws identified here were remediated. |
Backers
Gyroscope raised $4.5 million in seed funding (announced March 9, 2023). The round was co-led by Placeholder VC and Galaxy, with participation from Maven11, Archetype, and Robot Ventures. Angel investors included Cyrus Younessi, Fernando Martinelli, Hart Lambur, Will Villanueva, and others. The official Gyroscope website (gyro.finance) lists Placeholder, Galaxy Digital, Maven 11, Robot Ventures, Archetype, Balancer, Aave, and Polygon as supporters/backers. No subsequent funding rounds were found on official sources.
Legal
Legal form
Exempted company (FTL Labs) and foundation company (Gyroscope Foundation)
Registration jurisdiction
Cayman Islands
Status and notes
Two Cayman Islands entities disclosed: (1) FTL Labs, an exempted company incorporated and registered in the Cayman Islands — operates gyro.finance (Terms of Service and Privacy Policy, last updated Dec 2022); footer reads "©2025 FTL Labs". (2) Gyroscope Foundation, a foundation company incorporated and registered in the Cayman Islands — operates claim.gyroscope.foundation for GYFI token claiming (Terms of Use, last revised Oct 2024). A third entity, Superluminal Labs Ltd., is named on the licensing page as owner of LicenseRef-Gyro-1.0 closed-source software. The Gyroscope DAO is also referenced as having given FTL Labs a mandate to develop the protocol. Links to Terms of Service, Privacy Policy, and Claiming Terms are present and accessible on official sites.