Spark Moves $100M USDS into Crypto Carry Trade for 9% Yield
Spark has shifted $100 million of its USDS stablecoin reserves into Superstate’s USCC Crypto Carry Fund. The move comes as U.S. Treasury yields hit six-month lows near 3.976%, pushing DeFi platforms to seek higher returns. USCC now holds over $528 million in assets and uses a market-neutral crypto carry trade strategy to deliver 8–9% annualized returns for stablecoin yield. It exploits spot-futures basis trading on BTC and ETH to capture consistent gains over 30 days.
The strategy marks a departure from tokenized T-bills like BlackRock’s BUIDL and Franklin’s FOBXX that Spark previously used. Spark manages $9 billion in USDS liquidity and relies on protocol revenue to support its savings rate. By adopting crypto carry trade, Spark aims to optimize stablecoin yield and meet growing institutional demand for DeFi stablecoins. Traders should watch how this basis trading approach could influence futures spreads and yield benchmarks.
Neutral
Spark’s shift to a crypto carry trade fund represents a market-neutral arbitrage strategy. It uses spot-futures basis trading on BTC and ETH, balancing long and short positions to generate yield. Such strategies typically increase trading volume but do not drive directional price moves. In the short term, this may slightly raise spot and futures activity but not push prices significantly.
In the long run, consistent basis trading can improve market efficiency and tighten spreads without creating net demand. Traders are unlikely to see major volatility or price shifts for BTC or ETH solely due to this allocation. Therefore, the news is expected to have a neutral impact on cryptocurrency prices.