Permissionless Pools
Liquidity providers are integral to any DeFi protocol, and Spectra is no different.
A distinctive feature of Spectra Protocol is permissionless pool creation. The protocol allows users to create pools by supplying ERC4626-compatible interest-bearing tokens.
Providing liquidity to Spectra offers the opportunity to earn swap fees and yield from the assets held in the pool. Additional third-party incentives depend on active campaigns.
At the root level, the Spectra protocol is where three market actors converge:
#1 - Actors who anticipate the rates will go up
#2 - Actors who anticipate the rates will go down
#3 - Actors looking to earn fees from the activities of the first two groups.
Those activities come by various names: yield trading, fixed rates, upfront yield, etc. Fundamentally, Spectra applies a fee to every token exchange on the protocol, creating a source of yield for those supplying liquidity.
Pools on Spectra
Pool creation on Spectra is permissionless, meaning there is no voting or human-gated process. Anyone can open a pool with any amount of ERC-4626 compatible interest-bearing tokens and earn fees from powering all sorts of protocol activities.
When creating a pool, in addition to supplying the initial liquidity as an interest-bearing token, the user needs to specify its maturity date and target APR. The pool creation guide walks through the complete flow.
Sources of Yield
An LP position contains interest-bearing tokens (iBTs) and Principal Tokens (PTs). Its returns can include:
- A share of the pool's swap fees
- Native yield on the iBT portion of the position
- The PT portion's return toward its redemption value at maturity
- Third-party incentives, when an active campaign applies to the position
The iBT and PT contributions are weighted by the pool's composition. They are not two full yields added to the entire deposit, and providing liquidity does not guarantee a higher return than holding the iBT alone. The overall LP return varies with composition, market prices and trading activity.
Underlying platforms may also offer rewards or points, subject to their own eligibility rules.
Spectra's weekly SPECTRA emissions have been zero since 2 July 2026 under SGP-20. New LP positions do not earn native SPECTRA emissions. See the current emissions status.
Pool Infrastructure
Spectra is AMM agnostic. Initially, it leverages battle-tested Curve pool infrastructure to power efficient protocol swaps.
Future Implementations
One limitation of Spectra's current pool model is the expiry date, which means providing liquidity isn't completely passive.
The upcoming introduction of the MetaVault model addresses this by enabling automatic liquidity rollovers.