ETH Yield Term

The ETH Yield Term vault is a WETH earn vault on Euler that supplies into KPK-curated borrow markets priced on a calendar-aligned monthly term. The vault is the sole supplier to the underlying markets, with 24/7 monitoring and a managed WETH buffer to support smooth withdrawals across terms. The vault provides exposure to predictable, benchmark-priced ETH lending for depositors seeking above-market ETH yield and comfortable with longer-term positioning.

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Deposit

Live metrics (Dune)

Are you a borrower? This page is written for lenders. For borrower-side information (LST/LRT looping, fixed-rate mechanics, market parameters), see the borrowers' guide.

Key information

Deposit token	WETH
Chain	Ethereum
Protocol	Euler
Vault standard	ERC-4626
Vault token	KPK_ETH_Term
Vault address	0xB6D6D89ad4b4D61C15a293e28b74f77F6817fF48
Underlying markets	KPK-curated WETH borrow markets with cyclical fixed-rate pricing, plus a complementary allocation to the variable-rate Euler-curated WETH market
Yield source	Lending rates from monthly cycles using the Treehouse's Decentralized Offered Rate (DOR)
Cycle length	One calendar month (UTC), aligned to the 1st of each month
Deposits and withdrawals	Open continuously; not gated to cycle boundaries. Withdrawals depend on liquidity in the underlying term markets. KPK targets a ~10% withdrawable buffer through each cycle, so most redemptions process immediately; larger redemptions may need to wait until borrowers unwind at month-end.
Allocation model	KPK governs allocations across enabled markets and maintains a managed WETH buffer for withdrawals
Risk controls	Per-market caps, withdrawal buffer, 24/7 monitoring, supply gated via access-control hook
Liquidity target	Target ~10% withdrawable buffer during the lending phase; substantially higher during the end-of-month repayment phase as borrowers unwind
Performance Fee	0%

Why a term structure?

Variable-rate lending markets struggle to price ETH credit efficiently. Rates over-correct during utilisation spikes and sit below equilibrium when activity is quiet, an unpredictable environment for both borrowers and lenders. The underlying borrow markets supplied by this vault use a cyclical fixed borrow rate, free of the volatile interest-rate model of variable-rate markets, refreshed each month from a panel-priced benchmark for ETH staking rates (Treehouse's Decentralised Offered Rate). The result is predictability for both sides: borrowers know their cost of capital for the cycle, and lenders earn a smoother, benchmark-anchored supply yield. For depositors, this typically translates into a higher yield than variable-rate ETH lending markets, in exchange for reduced withdrawal flexibility during the cycle.

Cycles are aligned to UTC calendar months. Each cycle has a long lending (primary) phase at the cyclical rate, followed by a short end-of-month repayment (secondary) phase that encourages borrowers to unwind without forcing liquidations.

Because lent capital sits inside the active cycle, a depositor's ability to withdraw at any moment is tied to how much of the cycle is still drawn by borrowers and how much sits outside it. KPK targets a ~10% withdrawable buffer through the lending phase via a complementary variable-rate allocation (see Strategy), so the experience for most depositors is a normal same-block withdrawal. During the end-of-month repayment phase, withdrawal capacity typically rises as borrowers unwind, though it depends on borrower behaviour each cycle.

Strategy

KPK curates both the Earn vault and the underlying borrow markets. This includes setting caps and LTV/LLTV parameters, configuring oracle routing through the dedicated Oracle Router, designing the cyclical Interest Rate Model (IRM), and enforcing supply restrictions via a HookTargetAccessControl hook that allows only the Earn vault to supply. Markets are enabled after passing due diligence under KPK's Risk Framework, and each is assigned a risk tier and an allocation cap.

The underlying markets share a common cyclical IRM. Each calendar month is divided into a lending (primary) phase at the cyclical fixed borrow rate, followed by a one-day repayment (secondary) phase on the last day of the month at an elevated 50% APY. The repayment phase signals the end of the cycle and encourages borrowers to unwind ahead of the next reset; it does not force liquidations.

The cyclical rate for each cycle is set by KPK from the Treehouse DOR TESR 30-day forward benchmark, using a formula that anchors the rate to the panel-priced benchmark while preserving a positive net spread for suppliers

$$\text{Borrow rate} = \min(3.0\%, \max(\text{TESR}_{30d}, 2.5\%)) \times 0.90 - 0.20\%$$

A lender's realised supply rate over a full cycle approximates to

$$\text{Supply rate} \approx \text{Borrow rate} \times 0.95 \times \left( \frac{\#\text{days}_\text{month} - 1}{\#\text{days}_\text{month}} \right)$$

The (days − 1) / days factor reflects the brief repayment phase, contributing negligibly to supplier yield.

The Earn vault supplies into the cyclical markets and may also allocate to the Capital Prime Market as a complementary variable-rate allocation. eWETH-2 is curated by K3 Capital and accepts ETH, LST/LRT, BTC and stablecoin collateral types. The allocation supports baseline yield when cyclical-market utilisation is insufficient and provides a withdrawal-liquidity buffer that is not subject to the monthly cycle phase.

The Earn vault charges no performance or management fee. Yield from the underlying markets flows directly to depositors, net of the curator fees charged at each underlying market: KPK charges a 5% curator fee on borrow interest at the KPK-curated underlying markets (other curators, such as K3 Capital on its Prime Market, may set their own fees, typically up to 10%).

Vault management is handled by dedicated agents operated by KPK. Automated monitoring is fully in place today, supplemented by manual allocation. The rebalancing and exit agents are being gradually rolled out, scaling with vault TVL, with the full automation expected to wrap up around mid-June 2026. The agents monitor borrow utilisation, APY shifts, oracle liveness, price divergence relative to reference venues, and available liquidity to keep allocations within risk limits and support competitive yields (Monitoring and Response). Beyond allocation, KPK operations also cover IRM redeployment between cycles and cycle-boundary cache refreshes, executed by the Curator Safe under the scoped permissions described in Governance and controls below.

Risk framework

This vault follows KPK's Risk Framework for market selection, tiering, and ongoing monitoring. Reviews consider onchain and offchain diligence, together with external signals where relevant. Material parameter changes and their rationale are recorded in the Euler Change Log.

Risk-tier snapshot

Market exposure	Issuer	Risk tier	Allocation cap	LTV & LLTV	Oracle
wstETH term	Lido	A	90%	94.5, 96.5%	Fundamental
tETH term	Treehouse	C	75%	89.5, 91.5%	Fundamental
Capital Prime Market	K3 Capital	B	90%	82.0, 94.0% 84.0, 96.0%	per market

Figures are indicative. For current values, see the Euler UI and Euler Change Log.

Key risks

• Benchmark risk. The cyclical rate is set from the Treehouse TESR panel print at cycle reset. An off-target print affects supplier yield for the cycle.
• Collateral-specific risk. tETH is a Treehouse receipt token; exposure depends on the integrity of the Treehouse vault and its underlying composition. wstETH carries Lido's standard staking-derivative risk profile.
• Withdrawal liquidity. Withdrawal capacity at any point in time depends on the WETH buffer held in the Earn vault, the share of each cyclical market that is borrowed, and the size of the allocation to eWETH-2. KPK manages the buffer; large withdrawals during a fully utilised cycle may require waiting for end-of-cycle repayments.
• Inherited K3 Capital exposure. The complementary allocation supplies into a market curated by K3 Capital (eWETH-2); KPK does not curate this market, and the set of accepted collateral may change over time.
• Standard protocol risk. Smart-contract, oracle, and dependency risks in Euler, the underlying collateral protocols, the IRM, and the access-control hook.

These risks are actively monitored and managed, but cannot be fully eliminated. See the Euler Disclaimer.

Governance and controls

Critical actions follow a layered process designed for transparency, security, and timely response.

Governance changes (timelocked)

Changes that can expand risk or permissions, such as enabling a new market, increasing market caps, or changing the IRM, execute via KPK multisigs and a 3-day timelock. The Guardian can intervene during the timelock window if required.

Operational changes (not timelocked)

Operational actions within pre-approved bounds are delegated through scoped permissions. These include reallocate() on the Earn vault, submitCap() as part of Earn-level de-risking, and setCaps() on the underlying borrow markets to support faster reduction of exposure where needed.

Roles, multisigs and agent permissions

Roles

Earn Vault

• Guardian: Security Council Safe (5/8) 0x354C92aF243d53A24feb3dFF20372Af7b7c47478
• Owner: Security Council Safe (5/8) 0x354C92aF243d53A24feb3dFF20372Af7b7c47478
• Curator & Allocator: Curator Safe, with a Permissions Layer for agents (2/5) 0x715f757146846E6D63929bd2c1b334b18B8A1841

KPK does not use Euler's public Allocator role, reducing the attack surface. Automation is instead scoped through KPK's Permissions Layer and Euler's roles system.

Underlying borrow markets (tETH and wstETH term markets)

• Governor Admin: Curator Safe, with a Permissions Layer for agents (2/5) 0x715f757146846E6D63929bd2c1b334b18B8A1841 The Curator Safe also acts as Governor of the Oracle Router used by these markets, and as admin of the access-control hook that gates supply to the Earn vault.

Agent permissions

• Rebalancing agent: may call reallocate() to move funds between approved markets.
• Exit agent: may call reallocate() to move funds to idle, submitCap() as part of de-risking, and setCaps() on the underlying borrow markets to reduce or remove exposure.

Agents are deterministic programs, not AI. They can only call the whitelisted functions above. The vault is non-custodial.

For role definitions, see Euler Earn roles.