MainStreet

MainStreet is a DeFi protocol that delivers institutional-grade, market-neutral yield through a multi-token system on Ethereum. It offers msUSD, a stablecoin always redeemable 1:1 for USDC, and msY, a strategy token that accrues yield when users stake msUSD. The protocol democratizes options box spread strategies — a delta-neutral, synthetic-bond trade historically reserved for hedge funds and quantitative funds — packaging them into an onchain token accessible to anyone.

Where the yield comes from

MainStreet's yield is generated by running options box spreads on Deribit, a major crypto options exchange, using European-style options (the kind that can only be exercised at a set expiry date).

How a box spread works

A box spread combines two paired positions:

• A synthetic long (buy a call option + sell a put option at a lower strike price, K1)
• A synthetic short (buy a put option + sell a call option at a higher strike price, K2)

Together, these four options create a position that acts like a zero-coupon bond — it pays the fixed difference (K2 minus K1) at expiration, with almost no exposure to price moves (delta) or volatility shifts (gamma). In plain terms: the trade locks in a predictable return, isolated from market direction.

Why the opportunity exists

The real engine is retail options demand. When regular traders buy or sell options on Deribit, market-makers need to hedge their own risk. They often do this by building box spreads. The msY Vault supplies liquidity for those box spreads, letting market-makers free up their capital. In exchange, the protocol captures the yield premium built into those trades.

Execution details

The strategy uses margin efficiency — only 5–10% of the trade's notional value needs to be posted as collateral — which gives it built-in leverage. Positions are laddered (spread across multiple short-dated expiries and different strike ranges) to limit interest-rate risk and smooth out returns over time.

How the yield is shared

Gross yield is split three ways:

• 80% goes to msY holders, who see it as automatic appreciation in the msUSD↔msY exchange rate — no manual claiming needed.
• 10% flows to an Insurance Fund to backstop the protocol.
• 10% goes to the treasury.

If funding rates (the cost of maintaining leveraged positions) rise significantly above normal competitive levels, the protocol may retain a portion of yield. This builds a buffer to stabilize returns when rates later drop, and to support ongoing operations.

Capacity awareness

The strategy is capacity-aware: if adding more money would meaningfully compress yields or worsen the risk profile, inflows may be throttled or paused.